The process of owning a home entails a substantial investment. It’s a massive responsibility because not everyone can pay the mortgage for an extended period, which may take up to 30 years to complete.

Unfortunately, unforeseen events in life like a terminal illness or accident in the family can significantly affect your finances. While you may have had a plan regarding the monthly payments when you borrowed money from the bank or other lenders, you may find yourself struggling to keep up with your financial responsibilities at this point.

You may be left with two choices. The first is to go for a short sale of your home while the other is to wait for a foreclosure ordered by the lender. Before you can determine which one is more beneficial for you, you must understand these concepts so that you can then weigh their pros and cons in light of your dire straits.

We Buy Your House 101: Short Sale

A short sale pertains to the process of selling your home at a much lower value than its market price and what is owed on the mortgage. For instance, if you still have 200,000 USD left on your balance, going for a short sale means accepting payment of 180,000 USD, which makes you 20,000 USD short.

Most homeowners who short-sell their properties negotiate with their lenders to accept a lower price. However, you can approach companies who buy houses in cash, which makes the transaction more straightforward.

We buy your house in West Chester and help you sell off the property in a few days. You just need to enter your contact information on the website, wait for the call, and get the cash immediately once you accept the offer.

We Buy Your House 101: Foreclosure

Meanwhile, foreclosure is your legal eviction from your home because you failed to make the necessary payments for a significant period, typically after three to six months. The bank or lender will file a notice with the County Recorder’s Office that you’ve defaulted on your mortgage.

Foreclosure Vs Short Sale

However, going through foreclosure leads to undesirable consequences. You can still salvage the situation through short-selling, which is one of the last options you have before getting booted out of your home.

Here are the benefits if you go for a short sale:

1. Prevent a Foreclosure

The primary advantage of short-selling your home is to stop a foreclosure from happening. This process creates a ripple of adverse effects that not only affects your finances but the lender’s as well.

As the borrower who defaulted on the mortgage, you may find it difficult to borrow money for major purchases in the future like another home or a car. Plus, you’d go further in debt because there are foreclosure charges that you need to settle.

2. Protect Your Credit

While short-selling your mortgage loan can be a negative point for future lenders, it’s still better than having your records tainted with a foreclosure. With a short sale, at least, you found a way to repay your debts, albeit partially.

3. More Control

A short sale also gives you more control over your financial circumstances. Getting notice for a foreclosure can be stressful and anxiety-inducing. When you go for short-selling your property, you regain a little bit of autonomy because you get to play an active role in selling your home, even if it’s at a lower value.

4. Save Money for You and the Lender

As mentioned above, a foreclosure entails additional fees and costs that you have to settle. Plus, it’s not only you who’ll end up shelling out money, but the bank or the lender as well. That’s why most lenders are open to negotiations before pushing through with a foreclosure.

5. Help the Housing Market

Foreclosure adversely affects the housing market because property prices drop in areas where there are lots of foreclosed homes. When you opt for short-selling your house, you can help the market by retaining the value of properties around the neighborhood.


A short sale is one of the last remaining options that homeowners can consider before a foreclosure. It entails selling your property at a lower price than what you owe the lender.

Even if at times it may entail that you defaulted on your mortgage loan, short-selling your home still has benefits for the homeowner because it gives you more control of the situation while protecting your credit rating. Moreover, you avoid paying foreclosure fees and help the housing market as well.