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Short Sale

Definition: Short Sale

When, in August, 54.2 percent of Californians with homes on the market sold their properties at a loss, the sellers were involved in short sales. The term refers to selling a home for less than the value of the mortgage, and the owners end up still owing money on the property after they've sold it.

While it's ideal to stay in your home until the market improves, sometimes there are circumstances like changing jobs that make it impossible. Banks aren't in the business of forgiving the debt still owed in short sales, and are making the mortgage holders sign I.O.U. letters agreeing to pay part or all of the balance.

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Berlin Berlin 7 years
I was looking into this for a historic home I was interested in...the lady purchased it for 5K (yes, you read that right!), and ended up doing a second mortgage and refinancing through the years so she's got this place under almost a 400K mortgage now and the home isn't appraising higher than 200K in the current condition and in short sale. Couldn't believe how someone could hike up their payments like that, and it will obviously go into foreclosure so I can only hope to snatch it up there for a few ten grand:)
cubadog cubadog 7 years
Someone I know is going through this now. Her realtor told her that should would be better off leasing her house until the market turns around. Her and her man aren't listening though he decided to pay out the $30,000 to get her out of the house. Nothing like refinancing your way out of your house!
lawchick lawchick 7 years
when I bought my house, it wasn't a short sale for the sellers, but close. they came away from closing with like $500. it was kinda sad!
ilanac13 ilanac13 7 years
i think that short sales are a lot more common than people realize. i feel like when you have a huge mortgage, you're in a lot of debt and even if you sell for less than the value, you're eliminating a lot of your debt, and it makes it a bit more realistic to what you can pay off. i have a house that i would LOVE to sell but based on the way that the market it, i would lose money on it so i can't afford to do that. i think that if i were in a dire situation, maybe i would consider this, but i don't think that it's realistic for me to do it right now. i always feel bad for families that have no choice but to sell their house and to take a loss. it's hard when you don't see a light at the end of the tunnel, and i hope that the housing market rebounds sometime soon so we can try to get out of this hole.
Renees3 Renees3 7 years
My realtor said that short sales are kind of a hassle because the banks usually don't like them and take forever to get things going. and believe me, the banks are dragging their feet on everything. You'd think they want to get rid of the houses. We put an offer in on a foreclosure 2 weeks ago and we're just getting into talks with them now. It's annoying but we really like the house so we'll do what we gotta do.
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