Karen Ann Ulmer, P.C.
Pay Online
Legal & Mediation Services Call for a Confidential Consultation
P 215-752-6200 | F 215-752-6202

Short Sale Basics

A short sale is an alternative to foreclosure. The lender allows the home to be sold for less than what is owed on the mortgage. It is usually less of a loss for the lender to allow a short sale than to let the home go into foreclosure. Once a home goes into foreclosure the lender loses even more money on a monthly basis providing for the upkeep of the home and paying the taxes. Additionally, it is less of a hit on the credit of the seller to go through with a short sale over a foreclosure. A seller should try to negotiate with the lender to minimize damage to their credit rating as part of the sale agreement. To be eligible for a short sale, the seller must be behind on payments due to financial hardship. Proof of this hardship must be established by supplying tax returns, pay stubs, bank statements and list of monthly expenses. A short sale is not likely to occur if the seller is already in bankruptcy as a short sale is considered a prohibited collection activity. 

The short sale process moves most quickly if it is pre-approved by the lender for a certain amount although this is not usually the case. It is a good idea to work with a real estate agent or attorney to help negotiate the short sale process between the lender and potential buyer and ensure a timely sale. The short sale process becomes more complicated if there is more than one lender. Second mortgages or home equity lines can muddy the short sale process especially since secondary lenders stand to take the biggest loss on a short sale and all the lenders need to be in agreement with the terms for sale. Buyers stand to gain the property at a discount through a short sale but should exercise caution and do thorough research on the prospective property. All parties should be prepared to be patient with the short sale process and seek guidance/representation by an expert in the area. 

Click here to read more about Real Estate Law.

No Comments

Leave a comment
Comment Information
Email us for response

Do You Need Answers?

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Firm Locations

Langhorne Office
174 Middletown Blvd
#300
Langhorne, PA 19047

Phone: 215-752-6200
Fax: 215-752-6202
Langhorne Law Office Map

Doylestown Office
196 West Ashland Street
Doylestown, PA 18901

Phone: 215-348-3800
Fax: 215-752-6202
Map & Directions

King of Prussia Office
630 Freedom Business Center
3rd Floor
King of Prussia, PA 19406

Phone: 484-704-2100
Fax: 215-752-6202
Map & Directions

Jenkintown Office
610 Old York Road
Suite 400
Jenkintown, PA 19046

Phone: 267-636-0100
Fax: 215-752-6202
Map & Directions