What is a short sale?

A "short sale" is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan.  It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the current debtor.  Both parties consent to the short sale process, because it allows them to avoid foreclosure, which then involves hefty fees for the bank and poorer credit report outcomes for the borrower.

A foreclosure is the legal process by which an owner's right to the property is terminated, usually due to default.  This typically involves a forced sale of the property at public auction, with the proceeds being applied to the mortgage debt.

Foreclosures or short sales are indeed going to affect the market value of the neighboring homes in one way or another.  Whenever a house sells in a neighborhood, the amount at which the house is sold is noted and has an effect on general housing prices within the same locality.  If your neighboring house is facing short sale or foreclosure, then the house sells for much less than it would have if it hadn't gone into foreclosure.  Additionally, if that foreclosed house is similar to yours in size and attributes then this can depreciate the market value of your house.

The same is true when people sell their homes for less than the homes are actually worth because they just want to get rid of mortgage loan.  Every real estate transaction in your neighborhood has the potential to bring down the market value of your home.  Every real estate market is different. As a real estate professional my main goal is to get you the best price in any market!

Sara Maynard

saramaynardkw@gmail.com

586-747-0866

Artical provided by:MiReal Source