What are the logistics of a short sale?
A short sale is when a bank agrees to allow a Borrower (home owner) to sell their house to someone else (usually NOT another bank) for less than the Borrower owes to the bank. The Borrower MUST agree to a short sale, because the bank will ask for financial information on which to base their decisions on whether or not to accept the short sale. So you can’t “get a short sale house” unless the owner is still the owner and involved in the process. For instance, say a Borrower owes $100,000 to a bank. But values have fallen, or they borrowed too much to begin with (which happened when banks were giving out 100% and 120% loans). The Borrower has to sell, usually because they can no longer afford the house. Most (though not all) short sales happen after people stop making payments. They find a buyer that will buy the house for $80,000. If they sold the house traditionally, they would have to come to closing with $20,000. So instead, they ask (beg) the bank who holds the mortgage to allow the
