What is a short sale on a foreclosed house?

A short sale transaction occurs when mortgage lenders allow the borrower to sell the house for less than the amount owed on the mortgage. The foreclosure process occurs when lenders repossess the house, often against an owner’s will. You’ll also have to wait five years to buy another house.

Is pre foreclosure the same as short sale?

Pre-foreclosures are also often in the same condition as Foreclosures but will take less time to acquire than a short sale. Both are sales conducted by either the owner or a real estate agent. The difference is that with a short sale, the bank is involved and may reject offers accepted by the owner.

What’s the difference between a short sale and foreclosure?

Short sales and foreclosures. Both short sales and foreclosures are usually the result of a borrower’s inability to continue making mortgage payments. A short sale is where your mortgage lender allows you to sell the home for less than your outstanding loan balance and cancels your obligation to repay the remainder of the loan.

When to buy a house in a short sale?

A short sale happens when a seller’s lender agrees to accept less than its unpaid mortgage balance to facilitate a sale between the seller and buyer, and banks take a long time to decide. Some short sale buyers wait six months or more for a response.

Can a bank undersell a house for a short sale?

By law, banks cannot undersell the property or even advertise it as a mortgagee or fire sale. If they foreclose, banks cannot chase the borrower for any shortfall.

What happens when a short sale is closed?

If the lender accepts the short sale terms, the loan debt will be settled and the borrower released from any further liability once the short sale has closed, says Paola Martinsen with Equity Real Estate in Murray, UT.

What are short sales house?

A short sale in real estate is one in which a house is sold for a price that is less than the amount still owed on the mortgage . It is up to the mortgage lender to approve a short sale.

How to stop or postpone a foreclosure sale date?

How to Stop Foreclosure Sale Date Contact lender for mortgage statements and ask for forbearance. Decide if you want to pay the balance or refinance. Challenge the foreclosure with a lawsuit. File for bankruptcy. Offer the house up for a short sale.

What are short sales on houses?

A short sale is the sale of a home for less than the homeowner owes on the mortgage. A homeowner who is unable to keep up with the mortgage payments may try to sell a home in a short sale to avoid going into foreclosure.

What is a short sale house?

A short sale is a home that is available at a purchase price that is less than the amount owed by its current owner. The transaction benefits the bank by allowing it to avoid repossessing the home in foreclosure, which is expensive and time-consuming.