The are different ways that homeowners may buy a home so it is helpful for them to be familiar with what their options are. One option is a short sale but potential homeowners may have many questions about what a short sale is and if it is a good option for them.

Short sales are one residential real estate option for potential home purchasers to consider which can present a good value in some circumstances. One of the challenges associated with a short sale, however, is that they can take a longer period of time than a typical residential real estate sale. A short sale occurs when the lender to the seller has agreed to accept a reduced purchase price to release the existing mortgage on the property.

In circumstances of a short sale, the seller of the home as well as the seller’s lender must approve the sale because the seller’s lender will be accepting a reduced price on the property. Short sales are common in circumstances of pre-foreclosure, however, the seller does not necessarily have to be default on the home for a short sale to be considered. If the value of the home has fallen below what the seller owes on the mortgage on the home, a short sale may be considered on those circumstances as well.

Because there can be complexities, challenges and some pit falls associated with short sales, but opportunities as well, it can be helpful for prospective buyers to have trained guidance through the process of a short sale. Residential real estate provides a variety of options for potential buyers and sellers to be familiar with.