Goal of a Short Sale

The main goal of a short sale is to prevent foreclosure; however, the bank’s decision to move forward with a short sale is dependent on whether there will be a smaller financial loss taking the short sale in the carrying costs associated with foreclosure. Typically, a bank will determine the amount of equity by determining a probable selling price from a broker price opinion (BPO) or appraisal, and decide to approve or deny the short sale based on the offered short sale price difference compared to the costs of foreclosure. Banks will not accept all short sales, and a trained, knowledgeable real estate professional is paramount to the process of getting a short sale approved.