A short sale is simply where you agree to sell your home for less than you owe on your mortgage(s). This requires that you bring a buyer to your bank, with a contract for sale and purchase of the property. However, of critical importance here is making sure that the bank agrees not to come after my clients for any money at all after the short sale. Because a short sale typically requires that you leave the home, it is essential to negotiate with your lenders so that a waiver of deficiency is given by the bank as part of the short sale.
There are also government programs aimed at helping homeowners through the short sale process, such as H.A.F.A., H.A.R.P. and H.A.R.P 2.0. As part of the short sale process, the homeowner is required to make a financial disclosure to the lender, and a critical part of the process is reviewing my client’s financial situation before any disclosures are made. It is also typically my focus, in short sale negotiations, to get a waiver of deficiency from the bank(s) so my clients do not need to worry about the bank ever coming back after them for money in the future.