What Is a Short Sale?
By Douglas Jacobs, California Bankruptcy Attorney on Aug 30, 2007 in General Bankruptcy Information
Many realtors talk about “short sales” to aid a homeowner who can’t get enough money out of the sale of their home in today’s market to pay the liens. A “short sale” is an arrangement made with a mortgage company to take less than what is actually owed.
Thus, if a home has, for example, a first of $200,000 and a second mortgage of $100,000 but will only bring $280,000 on the market, the homeowner can only sell it if the mortgage holders reduce the amount owed by $20,000 (not accounting for costs of sale).
Sometimes this makes a lot of sense. For example if the first mortgage in the above example is about to foreclosure, the second mortgage holder might get completely wiped out. Better to take $80,000 or even $60,000 than end up with nothing.
If you liked that post, then try these...
Another reason to file Chapter 13 by Cathy Moran, California bankruptcy lawyer
Predatory Lending Part One: You Are Not In Kansas Anymore by Kurt O'Keefe, Attorney at Law
Why Am I Suddenly Having Trouble Paying My Credit Card Bills? by Stephen Otto, Pennsylvania Bankruptcy Attorney
2 Trackback(s)
You must be logged in to post a comment.