When it comes to working your way through the mass of financial information and terms that’s thrown at you as a homeowner, you’ll probably find that good, clear definitions can be hard to come by. With recent developments in government policies relating to short sales and foreclosure, many homeowners (especially those facing financial difficulties) find themselves asking, “What are short sales?
Short sales are increasingly common in today’s down real estate market. When a mortgage owner can no longer pay the mortgage, the mortgage lender will sell the house, using the funds to help pay for the remaining difference between what the homeowner paid and what the homeowner still owes. Because the sale is always at a loss, it is known as a short sale.
A short sale can be a reasonable way for you, as a mortgage owner, to get out of a house that you can’t afford because of a change in your income or market conditions. While short sales used to be extremely uncommon, these days they are more widely prevalent. However, the process can still be tedious for sellers and patience goes a long way towards a successful sale.