The Taylor's wanted to purchase a house that was a short sale, so they were ecstatic when the financing was approved.
An example of a short sale is when you owe $150,000 on your home mortgage and $5,000 in Home Owners Association fees and your mortgage lender approves the sale of your house for $130,000.
- The sale of a borrowed security in anticipation of making a profit by repurchasing it after its price has fallen.
- An investment in an exchange-traded fund or derivative security whose performance is inversely related to that of a particular index.
- The sale of a property for less than the amount owed on it, with the lender consenting to accept the lesser amount and cancel the debt in lieu of instituting foreclosure proceedings.
(plural short sales)
- (real estate) A property sale negotiated with a mortgage company in which a lender takes less than the total amount due.
- (investments) A sale of a security that one does not own, delivery obligation met by borrowing the security from another owner.
- (economics) A sale of a financial security, commodity, or other good that one does not own with the contractual obligation to make delivery of the good to the buyer at a date in the future.