What are the differences between a foreclosure and a short sale?

Foreclosure and short sale are two processes that involve homeowners unable to pay their mortgage. In both cases, the lender may take possession of the home. There are differences, however, between the two processes. In a foreclosure, the homeowner does not have any control over the process. The lender begins the process by filing a Notice of Default after the homeowner is 180 days behind on payments. The lender may then file a lawsuit against the homeowner if payment is not made. Eventually, if the lender wins the lawsuit, the homeowner is evicted and the lender takes ownership of the home. A short sale, on the other hand, is when the lender allows the homeowner to make a sale of the property with the proceeds of the sale being used to pay off the mortgage. The homeowner has some control over this process and it is usually negotiated between the homeowner and the lender. The lender usually agrees to a short sale in order to avoid lengthy court proceedings and to avoid taking the home, as the short sale allows the mortgage to be paid off. In conclusion, the main difference between a foreclosure and a short sale is that in a foreclosure the homeowner has no control over the process, while in a short sale the homeowner has some control over the situation. In Oklahoma, foreclosures typically go through the state court system and short sales involve negotiations between the homeowner and lender.

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What are the differences between a foreclosure and a short sale?

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