Texas Short Sale Process
A quick overview once a seller decides to list the property.
Seller Decides to Sell
The seller chooses to list the home even though the mortgage payoff may be higher than the market value.
Review Mortgage & Hardship
The seller gathers loan info, payoff amounts, hardship details, income, expenses, and financial documents.
List the Property
The home is placed on the market with short sale language and pricing designed to attract a qualified buyer.
Receive Buyer Offer
A buyer submits an offer. The seller signs it subject to lender approval.
Submit Short Sale Package
The lender receives the contract, hardship letter, financials, listing agreement, HUD/closing estimate, and supporting documents.
Lender Review & Valuation
The lender orders a BPO or appraisal to confirm market value and decides whether the offer is acceptable.
Approval, Counter, or Denial
The lender may approve the sale, counter the price or terms, request more documents, or deny the short sale.
Close the Sale
Once approved, the buyer closes, the lender accepts the agreed payoff, and the seller avoids a traditional foreclosure sale.
Benefits of a Short Sale vs. Foreclosure
A short sale may give a homeowner more control, more time, and a faster path forward.
Less Damaging Than Foreclosure
A short sale generally does not reflect as poorly as a foreclosure on a homeowner’s credit history.
Potential Time in the Home
In some cases, the homeowner may be able to remain in the home mortgage-free while the short sale is reviewed, sometimes for several months.
Possible Relocation Assistance
Some mortgage companies may offer up to $3,000 in relocation assistance if the homeowner remains in and maintains the property through the process.
Faster Path to Buying Again
A short sale may allow a homeowner to buy another home in as little as 3 years, compared with 5–7 years after a foreclosure.