A short sale is when the value of the home is less than the underlying mortgages and the homeowner is in default. The homeowner is now “upside down” and attempts to negotiate with the lenders before they actually foreclose on him which can be beneficial to both bank and the seller as it allows him to have a better credit rating overall. Marin does not have as many foreclosures and short sales as the rest of California. Most foreclosures occur in Northern Marin.
While the sale of bank owned REO’s can often be expedited fairly quickly, depending on the lender, short sales are cumbersome and can often take months before a decision is forthcoming from the lender. In both cases there is also the uncertainty of the condition of the house when a buyer is ready to move in.