A short sale lets you sell your home for less than the mortgage balance — with the lender's approval — and walk away without a foreclosure on your record. Learn how short sales work, how to negotiate a deficiency waiver, and whether a short sale is right for your situation.
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Response within 24 hours
credit score point impact — more manageable than a foreclosure
months to get a short sale approved — but the waiver is worth the wait
relocation assistance you can often negotiate with the lender
to qualify for a new loan with extenuating circumstances after short sale
A short sale without a written deficiency waiver can leave you on the hook for thousands — even years after the sale closes. Don't settle for verbal promises.
Deficiency judgment: The lender can sue you for the remaining balance after the sale.
Wage garnishment: A judgment can lead to garnishment of your wages or bank accounts.
Tax consequences: Forgiven debt could be taxable without proper documentation.
New debt collection: The deficiency could be sold to debt collectors who pursue you for years.
Full debt release: The lender accepts the sale proceeds as payment in full.
Cleaner credit: Your credit report reflects the debt as settled, not partially owed.
No collections: The lender cannot sell the deficiency to a debt collector.
True fresh start: You can move forward knowing the debt is behind you.
The lender's first offer rarely includes a deficiency waiver. Our team negotiates on your behalf to secure the strongest possible terms — including the written waiver, relocation assistance, and a clean release of your obligation.
A short sale isn't for everyone. Understanding whether it makes sense for your situation is the first step before you sign anything.
You owe more than the home is worth — selling won't cover the mortgage balance.
You can no longer afford the mortgage and don't foresee finances recovering.
A foreclosure is looming — a short sale can prevent it from hitting your record.
You want to move on quickly — a short sale restarts the clock for buying a future home sooner than foreclosure.
You can actually afford your payments but are considering a short sale for convenience — other options may be better.
You have a strong defense against foreclosure — standing, TILA, or other claims may let you save the home entirely.
The lender hasn't agreed to a deficiency waiver — without one, a short sale can still leave you owing money.
You have equity in your home — if the home is worth more than you owe, a traditional sale is a better route.
Important: Before committing to a short sale, explore all other options first — loan modification, forbearance, and foreclosure defense may allow you to keep your home. A short sale should be one part of a comprehensive strategy, not a decision made in isolation. Our team reviews your full situation and helps you choose the path that protects you best.
A short sale is a transaction where the lender agrees to accept less than the full mortgage balance as payment in full when the property is sold. The "short" refers to the difference between what's owed and the sale price — not the timeline. Short sales can take 3-6 months to get approved.
| Factor | Short Sale | Foreclosure |
|---|---|---|
| Credit Impact | 100-130 point drop | 100-160 point drop |
| New FHA Loan | 3 years (no late payments during short sale) | 3 years |
| New Conventional Loan | 4 years (2 with extenuating circumstances) | 7 years (3 with extenuating circumstances) |
| Deficiency Risk | Negotiable — demand written waiver | Some states allow; some bar |
| Relocation Assistance | Often $3,000-$10,000 | Rarely available |
| Control of Process | You choose buyer and timeline | No control |
The single most important element of any short sale is a written deficiency waiver from the lender — stating they accept the sale proceeds as full satisfaction of the debt and will not pursue you for the remaining balance. Without this, the lender can still come after you years later. Never close a short sale without a signed deficiency waiver. In some states (like California under CCP § 580e), short sales on certain properties may have statutory deficiency protection — but never rely on this alone.
We help negotiate short sales with full deficiency waivers and relocation assistance. Free consultation.
Voluntary title transfer alternative
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Relocation assistance programs
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