What is a Short Sale? 

A Short Sale is the sale of a home where the Bank is not paid the full amount they are owed. In other words, after all fees are paid, the amount left doesn't cover the entire debt owed on the home. 

Is a Short Sale a home in Foreclosure? 

A short sale could be in foreclosure and usually the lenders will stop the final stage of foreclosure by the bank if there is an offer. Lenders are now working with sellers to make the short sale successful rather than take the property back as it is less expensive on them in the long run. 

Do I pay my mortgage each month while I have my house on the Market?  

This answer is up to you. Many factors go into making this decision, and really should be decided based upon a CPA's discussion of your finances. 

It is important to realize that it also helps eliminate the risk of a deficiency judgement if the property goes back to the bank in foreclosure. 

If my house is on the market, can the bank still foreclose?  

Yes, if the foreclosure process starts, the bank can still foreclose, even if your house is on the market. If your home is in escrow, and you are in default, the bank can still foreclose. An experienced agent negotiating with the bank on your behalf should be able to help you to prevent this situation. 

Does the Bank have to accept less than they are owed?  

No, not necessarily. On a short sale, the bank(s) must approve the sales price, the fees to be paid, and the time frame for the escrow to take place. If you have 2 loans, both banks must agree to the terms. 

What Happens When I get An Offer? 

Once we have sent the offer(s) to the lender(s), the actual Short Sale process can take anywhere from 4 weeks to 4 months. This timeline varies with each lender. 

To keep you informed, someone from my office will give you a call weekly with an update on status. 

After the lender reviews the Short Sale package, a BPO (Broker Price Opinion) will be ordered by the lender. This is similar to an appraisal and once the lender receives their report, they will usually make a final decision shortly thereafter. 

The lender orders the BPO so they can figure out what their net proceeds will be (how much of a loss they will be writing off). Your property will remain ‘Active’ on the MLS until the lender accepts the offer. 

A Short Sale Expert:  

You will benefit from working with a REALTOR experienced in negotiating with banks, other agents, and buyers during the short sale process. Short Sales are different than other transactions. I will make sure you have every opportunity to SELL your home instead of losing it to foreclosure. Call me anytime with questions: (760) 519-8723