Recent economic challenges have resulted in a proliferation of short sales and the need for real estate and mortgage professionals to provide competent assistance to property owners considering a short sale.
A “short sale” is a real estate transaction where the proceeds of the sale will not generate sufficient funds to pay the debt(s) secured by the property (and the seller is unable to pay the difference) and therefore, any creditor(s) with a security interest in the property must consent to receiving less than they are owed in return for releasing any lien on the property. The fact that a creditor may release its lien to allow the property to be sold does not mean that the creditor has or will forgive the deficiency.
DFI and the Washington State Department of Licensing have issued guidance documents to provide guidance to those professionals who provide short sale services and to address some of the most typical issues related to short sales.