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Whether you plan on purchasing a short sale home, or you plan on selling your home via the short sale process, I wanted to give you a definition, as well as the process that you may go through if you decide to go through this route.

What is a short sale?

To make things short, what you’re going to do is put your home for sale for less than what you owe.  You and the bank are going to call it even once the sale goes through.  You can’t sell your home until the bank agrees to the price point.

Back in the day, the short sale process didn’t exist, simply based on the fact that many homes were gaining in value.  Many could just sell, break even, or even make a profit.    Today, with the dwindling home sales, it’s a whole another story.

To get definition that explains it a little more, you can read more with this Wikipedia page.

How can I sell my home via a short sale?

The first step that you’re going to want to do is find a Realtor that specializes in them.  Many of them are going to shy away from them, since many buyers don’t want to wait out the process.

The next step is that you’re going to have to prove your hardship to the bank.  If you haven’t missed a payment yet, you’re not going to get approved for a short sale.  Instead, you’re going to have to miss at least 3 months and you have to prove that you can’t pay either.

After you can prove your hardship, agree to a term with the bank.  You will want to make sure that this number is approved.  If it isn’t approved, many buyers won’t even bother.

Once the number is approved, put the home up for sale through a Realtor.  If you do sell for the price, you will be able to wipe your mortgage clean and call it even with the bank.

For more information, you can check out AOL’s page here, as well as this About.com article here.

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