What is a Short Sale?

What is a Short Sale?

A short sale is simply where your lender accepts less than what you owe as payment in full at closing. Lenders have been accepting short sales for years. And, if you’re upside down and need to sell, you may qualify to short sell your house. Think of it like this… Let’s say you let someone borrow $100 and before they could pay you back they lost their job and couldn’t pay you. Then, one day they called you up and said “Listen, I don’t have the $100, but I do have $80. Would you accept this? Of course you would. Why? Because it would be better to get the $80 back than nothing at all, right? This is a short sale. Lenders accept short sales because, most times, they make more sense than getting the house back by a foreclosure. Right now, more than ever, banks just want to minimize their loss. If they can allow a short sale and avoid foreclosing on your house, they will.