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What exactly is a short sale for a house, and how does it differ from a foreclosure?
A short sale is a transaction where a homeowner sells their property for less than the outstanding mortgage balance, with the lender's approval.
Short sales are often chosen to avoid foreclosure or to sell properties that have become unaffordable or decreased in value.
The lender must approve the short sale, and the process can be lengthy and complex.
Buyers should carefully consider short sales, as they may not always be a sound investment.
Short sales typically result in less damage to a homeowner's credit report and credit score compared to foreclosures.
Foreclosures remain on a credit report for three to seven years, compared to seven years for a short sale.
Homeowners can typically apply for a new mortgage within one to four years of a short sale, but this can range from three to seven years after a foreclosure.
Lenders may require a deficiency judgment for the remaining balance in a short sale, which would require the original borrower to pay the difference.
Short sales can help homeowners and lenders resolve difficult financial situations.
Buyers can potentially secure a good deal on a short sale property, but they should be aware of potential issues with the property or title.
Short sales can result from various situations, such as job loss, divorce, or unexpected medical expenses.
Homeowners interested in short sales should consult with their lender to understand their options.
Short sales require patience and persistence from buyers, as the process can be prolonged and complex.
Real estate agents specializing in short sales can help buyers and sellers navigate the process and avoid potential pitfalls.
Short sales are more common in markets with high inventory levels or during economic downturns.
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