With all the Media Coverage of Short Sales, I can't imagine anyone Not being familiar with a Short Sale. If Somehow you've escaped all the Chatter, here you go....
A Short Sale is the Transaction in which the Lender agrees to accept Less than the amount of the Total Mortgage Owed. What this means to you as an Interested Home Seller is:
1. The Difference of the Debt CAN be Forgiven by the Lender OR
2. The Difference of the Debt MUST be Settled with the Lender
Either way, if you have ZERO equity in your Home, a Short Sale may be Less Damaging to your Credit History than a Foreclosure. Lenders usually incur Less Costs from a Short Sale than a Foreclosure.