Short Sale


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Short sale

Selling a security that the seller does not own but is committed to repurchasing eventually. It is used to capitalize on an expected decline in the security's price.

Short Sale

The sale of borrowed securities. In a short sale, one borrows securities, usually from a brokerage, and sells them. One then buys the same securities in order to repay the brokerage. Selling short is practiced if one believes that the price of a security will soon fall. That is, one expects to sell the borrowed securities at a higher price than the price at which one will buy in order to return the securities. Selling short is one of the most common practices of hedge funds. This is also called establishing a bear position. See also: Margin account.

short sale

The sale of a security that must be borrowed to make delivery. Short sales usually, but not always, entail the sale of securities that are not owned by the seller in anticipation of profiting from a decline in the price of the securities. A short sale is not permitted when the last preceding different price was higher than the current price. Also called selling short, short. See also fictitious credit, ghost stock, lending at a premium, lending at a rate, odd-lot short sales, Rule 10a-1, short against the box, short cover, synthetic short sale.

short sale

In real estate,the lender's agreement to release its lien upon property so that the property can be sold, even though the sale price will not generate enough money to pay off the loan. Investors who specialize in purchasing preforeclosure properties will often negotiate a short sale price with the lender as part of their strategy.Oftentimes,the lender will agree to forgive the balance of the mortgage debt.

Short Sale

An agreement between a mortgage borrower in distress and the lender that allows the borrower to sell the house and remit the proceeds to the lender.

Ashort sale is an alternative to foreclosure or a deed in lieu of foreclosure. See Payment Problems/Position of the Lender/Permanent Problem.

Short Sale

A sale in which the seller borrows the stock certificates or other property delivered to the buyer. At a later date, the seller either purchases similar stock or property necessary to "cover" the sale, and delivers it to the lender or delivers to the lender stock or property that he or she already held but did not wish to transfer at an earlier date. For income tax purposes, there is no gain or loss on the transaction until the short sale is covered by purchase and transfer. Special rules apply in determining whether the gain or loss on a short sale is a long-term or short-term capital gain or loss.
References in periodicals archive ?
If you are facing foreclosure contact The Gonzales Team short sale specialists of Henderson, Nevada for options.
The report noted that the percentage of suspicious short sales flipped for more than $50,000 has slightly decreased during the period of 2012 to second-quarter 2013.
Michaels has developed a quick, online survey that provides answers right away on whether or not a borrower might qualify for a short sale.
When deciding to go into short sale, most homeowners do so primarily to avoid foreclosure, which can be extremely damaging to an individual's credit report and have long-term effects on anyone seeking credit.
With the courts at a standstill and banks not foreclosing on properties," Halloran said, "the banks are getting better at doing short sales, so more people are doing them.
But according to Denver attorney Sara Mobley, who deals with many loan modifications and short sales, about eight out of nine short sales nationally fail because they don't meet the guidelines that the lender must adhere to.
His short sale rush system evolved from his personal hands-on experience in residential sales, mortgage lending, and property management, augmented by psychological, motivational, and practical techniques refined from his military leadership.
Lender of Record Does Not Match Lender on Short Sale Letter
While it's encouraging that lenders and servicers are making headway in improving their short sale processes, they still have more work to do to ensure that not only REALTORS([R]), but also home sellers and buyers have a better experience when dealing with short sales," said C.
Irene Medina, of The Medina Real Estate Group, CDPE - Certified Distressed Property Expert, says, “If you are still underwater in your mortgage and need to short sale your property, please, please beware of investment clubs that promise to connect your with short sale expert investors that can save you from foreclosure.
New short sale guidelines effective November 1, 2012 by the Federal Housing Finance Agency for Fannie Mae and Freddie Mac, make the short sale process easier and speedier for lenders and borrowers, but will present new challenges for servicers in getting lien releases executed in time.
While the goal is always to keep borrowers in their homes, those who have lost a job, have no source of income, are extremely delinquent, failed in a modification attempt or did not qualify for the Home Affordable Modification Program (HAMP) can avoid foreclosure and eliminate the burden of debt with a short sale.