What's so SHORT about a Short Sale?

Short sale - Can anyone tell me why they call it a short sale? Is it short? Is it close to short?

Here is why I am questioning the name: SHORT Sale.  The only thing that is SHORT is your Equity, Value of your home and the lender getting paid short of what is owed.  Maybe they should change the name to (Short on Equity Sale, FMV Short Sale, Negative Payoff, or Short of Debt Sale or Lender Short Sale or something like that).  Because the process is usually not SHORT.

• The time it takes to complete the sale is not SHORT!
• Owner having to pull their bills together to give an accurate financial statement is not SHORT!
• Real Estate Agent listing, marketing and obtaining an offer is usually not a SHORT process either!
• Its not easy either!  Everything has to be negotiated and that is not SHORT!
• Complications usually come up along the way.... still not SHORT!
• And lenders will usually not agree to a SHORT amount... even when they know that they will get even less if they go ahead with the foreclosure.  They lose more money with a foreclosure than with a short sale in most cases.  So why do they spend so much time delaying and denying short sale requests -- they know that they will come out better!
• Patience required is not so SHORT either!
• OH and yes, they probably will cut you SHORT on the negoitations!  That might be the only part that is short.....

In addition to finding a buyer, which is most usually not A SHORT time frame, you need to worry about Title Reports, Appraised value of the home, and the worry the lender will have over who is financing the new buyer??? All questions that the answers can cause the sale not be SHORT or easy.

One of the more pressing problems is when there are more than one lender. That adds up to DOUBLE TROUBLE or in some cases TRIPLE TROUBLE.  Although it is not easy to get an approval - even if both loans are with the same lender, it does help to have just one lender.  It gets really complicated when there is a first, second or piggy back and a home equity on top of that.  All but the first mortgage is called a junior lien.  Junior liens are lucky to get 10/20 cents on the dollar OR in most cases $1000 as compared to 0 if the property goes to foreclosure.  Junior liens get wiped out in a foreclosure. Although the junior liens know this they still fight back.  And from my understanding the junior liens are not Money purchase loans so they are not exempt from coming back on the owner after a short sale for that debt.

It is advised that each owner consult a professional tax or real estate attorney to fully understand the impact of a short sale before agreeing to the sale.

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Check out my Mother and Daughter Blog for other tips for Sellers and Buyers. I work with my daughter as the Mother and Daughter Real Estate Team and we also focus in Short Sales and the Pre-Foreclosure process.  Our consultations are free.  Our aggressive marketing plan includes progressive on-listing advertising.  If you are thinking of selling or buying a home in Northern California's Central Valley (San Joaquin County - includes Stockton, Manteca, Lathrop) and Stanislaus County- includes Modesto, Riverbank); East Bay (Alameda County - includes Hayward, Fremont, Newark, Union City & Oakland) and surrounding areas.  If you would like a FREE Home Seller or Home Buyer Handbook, please call us at Perfect Financial Solutions 866-750-8282 or email at US.  Our best connection is our website: http://www.motheranddaughterrealty.com/.

The Mother and Daughter Realty Team

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