A short sale is when a lender will sell a property for less than the loan principal amount that is due.  Why would lender do this?  It is estimated by Alex Charfen who is an expert on distressed properties that a $200,000 home will cost the lender an average of $65,000 to up to $100,000 in expense if they have to foreclose, own, then dispose of the property. 

What cost so much?  Some expenses include seller concession, legal fees, taxes, insurance, utilities, maintenance, Interest loss, association dues and fees, closing costs, and commissions.  There can be many more, this is just a partial list.  

So a lender really has an interest in selling a property rather than foreclosing on it.  That said, the process of selling short, and buying a short sale is a slippery slope and you need someone with experience in this situation.  If you need help either selling short or buying a short sale, call John Garrett today at 573-302-2320.

You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.