If you’re looking at buying a home, you’re undoubtedly looking for good bargains. And under the right circumstances, a short sale could be just what you’re looking for. However, this is a somewhat rare type of home sale, and there’s no guarantee it will work out.

What Is a Short Sale?

A short sale occurs when a home is valued for less than its remaining mortgage, and the mortgage lender agrees to settle the debt for a smaller sum than they are technically owed. This allows the home to be resold.

Short sales typically happen when homes have depreciated for some reason. For example, neighborhood property values have dropped or a property itself may be neglected and lost value. In some cases, the property may have lost so much value that it’s no longer realistic for the mortgage lender to expect full repayment. 

Much of the time, the home’s current owner will be in some form of financial distress that prevents making mortgage payments. In this situation, the lender may be willing to agree to a short sale to get rid of a property that could cost the financial institution more money in the long run. A short sale can also bring in more money than if the home is repossessed and auctioned, which is a great motivator for the lender and a good reason to go along with it.

The Challenges of a Short Sale

The biggest hurdle to overcome when requesting a short sale is the mortgage lender. Financiers aren’t in the business of losing money and will be reluctant to discharge the mortgage for less than its value.

The current homeowner must convince the lender the mortgage is unlikely to ever be paid off. Sellers will need to be highly motivated to go through this process, typically to get out from under debt they can’t comfortably repay.

There’s also a high likelihood that the home has other issues. It may be in poor repair or there could be fines and liens attached to the property. A buyer will need to be very careful, surveying and researching the property thoroughly, to be sure it’s a good deal.

In the right conditions, a short sale can result in a bargain buy. But it’s a difficult deal to broker and many factors could confound the transaction. 

If you’re buying a home we can help! Contact us to discuss your needs!


Randy has enjoyed over 32 wonderful years in the Real Estate industry making dreams come true for homeowners.

Superior customer service is #1 to Randy and he provides this to all of his clients using knowledge, professionalism, integrity and persistence.

Randy is a successful and experienced real estate agent who expertly represents both buyers and sellers. Scores of Charlotte area residents have trusted Randy in the process of listing their homes to sell.

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