How Does a Short Sale Differ From a Foreclosure?
A Seller's Perspective
Selling a home through a short sale is one of the most common methods to avoid foreclosure. Keep in mind, however, that many sellers pursue short sales while they are going through the foreclosure process.
First, understand that a foreclosure is typically a long, drawn out series of legal steps that allows a bank to legally repossess a property that was used to secure a debt. Foreclosures typically take 6 to 18 months to complete. A home is not formally "foreclosed" upon until it is auctioned off at a county foreclosure auction. A homeowner is legally entitled to be given notice prior to these steps taking place. Under normal circumstances, you the homeowner should not have to worry about being forcefully removed from your house with little or no notice.
Many properties are successfully marketed and sold as short sales while the foreclosure process is underway. Most banks can be convinced to delay the foreclosure proceedings if they are convinced that the home has a better chance of being sold as a short sale. In fact, negotiating these details with the bank is a large part of what Derenthal Realty Group does when handling short sale properties.
Probably the most significant difference between a short sale and a foreclosure is the effect it has on a seller's credit score.