What is a Short Sale?
A "short sale" occurs when the bank accepts a sales price that is lower than the principal balance of the mortgage. In other words, the bank agrees to take less than is owed to them for the home.
Banks may be willing to do this when it is clear that their other option would to foreclose on the property. When a bank forecloses on a property, they often pay tens of thousands of dollars in legal fees, and then have to hire a real estate agent to sell the home at market price. Accepting a short sale allows the bank to take market price for the house without the additional expense of the foreclosure process.
Deficiency -
A "Deficiency Judgment" is when the bank still holds the homeowner responsible for payment of the balance. Instead of requiring the money when the house is sold, this legal judgement is applied, which can affect the homeowners credit until the judgement it paid.
Even after the house is sold, the bank may come after you for the difference between your selling price and what you owed them. Our trained negotiators work hard to convince the bank to release you of ALL liability for the home.