Just 23% of short-sale offers homeowners receive actually close, according to a February study that included 1,300 real estate agents. A short sale occurs when a home sells for less than is owed to the bank and has been viewed as an alternative to foreclosure.
However, lengthy delays on the mortgage lender’s end has prompted many would-be homebuyers to walk away from their deals. The delays are causing much frustration for homeowner’s who owe more than their homes are worth as well as real estate agents and homebuyers who are eager to settle their transactions.
Short sales use to be rare but are coming more popular as an alternative to foreclosure. A short sale is a lighter blemish on your credit record than a foreclosure, and while the mortgage lender does money on a short sale, the loss is far greater (and a hassle) in the case of foreclosure.
The good news is the federal government is stepping in and mortgage lenders are getting in gear. There’s hope that the short sale process will become, well, shorter in the future.
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