Bank Owned & Short Sale

A short sale is when a lender agrees to a payoff amount that is less than  mortgage balance. Simply put, there is more owed on the home than it will sell for.

The owner is attempting to sell the property during the pre-foreclosure period, before  the foreclosure can be completed. The term pre-foreclosure or preforeclosure is that  period between when the lender files a foreclosure notice of default in the public records (Lis Pendens) and the date the property is to be sold at public auction or trustee’s sale. Often lenders are taking back properties instead of holding the public auction or trustee’s sale.

Lender owned means the proeprty is owned by the lender. These properties are also  commonly referred to as REO’s, which means “real estate owned,” or bank owned.