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 ?
CoreLogic reported that 12 percent of suspicious short-sale resales occurred less than 30 days after the original short sale through the second quarter of 2013.
The FSC pointed out that at present for the offsetting of margin trading and short sales, the quotas for margin trading and short sales should be calculated separately.
Freddie Mac's new streamlined guidelines provide greater flexibility for servicers processing short sales for service members with Permanent Change of Station orders, including the elimination of back-end debt-to-income ratios or a cash contribution promissory note.
Another reason why homeowners resist short sales is because many people do not understand if they qualify.
Some banks are even handing out bonuses for owners who opt for short sales.
Later they decided marketing a similar product to Realtors would give them a bigger market than targeting the small number of auction-goers, so in late October they launched Short Sale ProLogic (ShortSaleProLogic.
Because short sales deal with mortgages in default, and most of these properties are sellers' residences, some foreclosure laws also apply to short sales.
Prior to the TRA '97, a taxpayer generally did not recognize immediate gain on a short sale against the box.
He then sells the borrowed stock through the same broker,and the proceeds of the short sale earn interest at a broker loan rate, which is currently approximately 5 percent.
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.
Short Sales are one of the alternatives to foreclosure.