Selling Short, or “Short Sale” is a term that we use to describe the process of selling your home for less than you owe the bank.
Why would you do this?
If you are unable to bear the cost of your mortgage as a result of a variable rate change, or job loss, or any other circumstance, you would be forced to move. Rather than letting the bank foreclose and boot you from your home, with the help of a Realtor, you can in many instances be approved by the bank to sell it for less than you owe.
By selling short, you damage your credit less than if you go to foreclosure.