The recent real estate condition has brought forward the word short sale like never before. If you still have not a clue what a short sale is, it means when a homeowner gets the bank to accept less than what is owed as payment in full.
For instance: a homeowner owes 250,000 in mortgage on a property that is worth 250,000. That means the property does not have any equity. In the beginning of the real estate burst, many people have walked away from their homes. Taking everything they could with them such as dish washers, microwaves, shelves, etc., leaving the property in a bare building state. While many have used the short sale process to sell their homes for less than what they owe and tries to get the bank to accept the new offer as payment in full.
When homeowners fall behind in their payments, yet don’t want to walk away from their mortgage, some have worked with a Realtor to deal down the 250,000 (using the same number as an example) if the bank accepts, the homeowners now have equity in the home that originally had none.
The short sale method is a win-win situation for all stake holders in the deal. The buyers of the short sale is getting a great deal for the home, the bank is getting a different loaner to take on the loan, and the homeowners are happy to move on with their lives.