Real Estate Journal

You have probably heard about the term “short sales.” These are sales that occur when a property seller, at the time of sale, will no longer have negative equity. Essentially, there is no more mortgage or loan money remaining to be paid in the original financing of the property. This is to make sure the seller would have already fullfilled his bank obligations.

Therefore after commissions and closing costs, there is no longer any money required to pay for financing the home. Banks usually allow this to avoid foreclosre, which would mean less money for them in the end, and more trouble for the owner of the property. So rather than foreclose, they would opt to receive a smaller amount than originally intended rather than nothing at all.