Definition of Short Sale:
Orange County Short Sales:
Any sale of real estate that generates proceeds that are less than the amount owed on the property is considered a “Short Sale” the bank or lender got “Shorted” on the monies that they were really owed. A real estate short sale occurs when the lender and borrower decide that selling the property and absorbing a loss is preferable to having the borrower outright default on the mortgage. It is therefore considered an alternative to foreclosure – but still damaging to a borrower’s credit.
Real estate short sales can be done only by mutual consent of borrower and lender – with the emphasis being on the lender, they are the ones with the most to lose. However, both parties can benefit from this type of transaction. Borrowers can avoid having a foreclosure appear on their credit report, while lenders can avoid major fees associated with a foreclosure.