Short Sales

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What is a Short Sale?

A short sale is a sale of real estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property, and the property owner cannot afford to repay the liens’ full amounts, and whereby the lien holders agree to release their lien on the real estate and accept less than the amount owed on the debt. Any unpaid balance owed to the creditors is known as a deficiency. Short sale agreements do not necessarily release borrowers from their obligations to repay any deficiencies of the loans, unless specifically agreed to between the parties. A short sale is often used as an alternative to foreclosure because it mitigates additional fees and costs to both the creditor and borrower. Both often result in a negative credit report against the property owner.

Short Sale Timeline

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1 to 3

Days An offer is made, subject to the lender’s approval.

Week 1

The short sale package is prepared and submitted to the lender.

Week 3

The lender orders a broker’s price opinion (BPO).

Week 4 to 5

The lender says they can’t find the package and asks the buyer to resubmit it.

Week 5 to 6

The BPO is submitted to the lender.

Week 6

The BPO is evaluated by the lender.

Week 6

The lender says they can’t find the package and asks the buyer to resubmit it.

Week 7 to 8

A loss mitigation specialist is assigned and the whole package is reviewed.

Week 9

The lender proposes a counter offer.

Week 10 to 12

12 Negotiation continues until an agreement is reached.

  • 1 to 3
    Days An offer is made, subject to the lender’s approval.
  • Week 1
    The short sale package is prepared and submitted to the lender.
  • Week 2
    The lender processes the package.
  • Week 3
    The lender orders a broker’s price opinion (BPO).
  • Week 4 to 5
    The lender says they can’t find the package and asks the buyer to resubmit it.
  • Week 5 to 6
    The BPO is submitted to the lender.
  • Week 6
    The BPO is evaluated by the lender.
  • Week 6
    The lender says they can’t find the package and asks the buyer to resubmit it.
  • Week 7 to 8
    A loss mitigation specialist is assigned and the whole package is reviewed.
  • Week 9
    The lender proposes a counter offer.
  • Week 10 to 12
    12 Negotiation continues until an agreement is reached.

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