The Top 5 Myths About Short Sales—And the Truth Behind Them

When it comes to short sales, misinformation is everywhere. Sellers hear one thing from a neighbor, agents read something online from ten years ago, and buyers assume short sales are just “foreclosure light.”

The truth? Short sales are a unique, highly strategic transaction that can benefit everyone involved—when handled correctly. Let’s break down the five biggest myths about short sales and uncover the reality behind each one.

Myth /#1: Short Sales Always Take Forever

It’s true—years ago, short sales had a reputation for dragging on for six months or more. Back then, lenders were still figuring out the process, and delays were common.

The Truth: With the right negotiator and proper file preparation, many short sales can be approved in 60–90 days, sometimes even faster. At Crisp Short Sales, we pre-package every file with exactly what the lender needs, cutting weeks off the timeline.

Myth #2: Short Sales Hurt Your Credit Just Like a Foreclosure

One of the scariest misconceptions is that a short sale damages your credit just as badly as losing your home to foreclosure.

The Truth: While any late mortgage payments will impact your credit, a completed short sale is typically far less damaging than foreclosure. More importantly, a short sale can allow you to recover financially faster—often making you eligible for a new mortgage in as little as two years, compared to seven after a foreclosure.

Myth #3: The Seller Has to Pay All the Costs

Many homeowners avoid short sales because they think they’ll be hit with big fees they can’t afford.

The Truth: In most cases, the lender pays the real estate commissions and negotiator’s fees. At Crisp Short Sales, there’s no cost to the seller or their agent—ever. Our fees are built into the transaction and paid by the buyer’s side at closing.

Myth #4: Short Sales Mean the Seller Is Walking Away With Nothing

There’s a common belief that in a short sale, the homeowner hands over the keys and walks away empty-handed.

The Truth: Many lenders offer relocation assistance at closing—sometimes thousands of dollars—to help sellers move. This incentive is especially common when the short sale is part of a government program or negotiated properly.

Myth #5: Any Agent Can Handle a Short Sale Without Extra Help

While any licensed real estate agent can technically list a short sale, that doesn’t mean they should try to manage the entire process alone.

The Truth: Short sales require specialized knowledge of lender processes, document requirements, and negotiation tactics. Without it, deals fall apart. That’s why experienced negotiators like Crisp Short Sales exist—to protect the deal, keep communication flowing, and make sure the closing actually happens.

Short sales are often misunderstood, but when done right, they can be a win-win for everyone involved—lenders avoid costly foreclosures, sellers avoid devastating credit damage, and buyers can secure great properties.

The key is working with someone who knows the process inside and out. At Crisp Short Sales, we’ve spent over 15 years perfecting our system so short sales close faster, smoother, and with less stress for everyone.

If you’re a seller or an agent with a short sale on your hands, start a short sale with us today. You might be surprised how quickly we can turn a “hopeless” situation into a done deal.

What Happens After You Accept a Short Sale Offer?

Accepting a short sale offer is an exciting step—but it’s really just the beginning. Whether you’re a homeowner trying to avoid foreclosure or a real estate agent guiding a client through the process, knowing what happens after the seller says “yes” can make the difference between a smooth approval and a stressful delay.

The Seller Chooses the Offer

In any real estate transaction, the sale of your home is a contract between the buyer and the seller, so the seller decides which offer to accept—not the bank. You’re not obligated to take the highest offer or meet any specific criteria. The decision is yours, based on what’s best for your situation.

Buyer Documentation: Proof They Can Perform

After acceptance, the buyer must show they have the ability to close. For cash buyers this means proof of funds; for financed buyers it means a pre‑qualification or pre‑approval letter. If the buyer is purchasing through an LLC, the lender will also require articles of organization listing all members and documentation that the person signing has authority to do so.

Ordering Title & Checking for Liens

Once the offer and buyer documentation are ready, work with your local title company or closing attorney to order title. The title report will list all liens, mortgages, and judgments on the property. Disclosing everything upfront prevents last‑minute surprises that could derail approval.

The Preliminary Closing Statement

Next, the title company or attorney will prepare a preliminary closing statement (also called an estimated settlement statement) outlining all of the costs on the seller side of the transaction. This includes mortgage payoff amounts, property taxes owed, title and attorney fees, HOA dues or special assessments, and transfer taxes. For homeowners, this is your first look at the numbers. For agents, it’s a required part of the short sale submission.

Submitting the Package to the Lender

Finally, your short sale negotiator will submit the executed purchase contract, buyer’s proof of funds or pre‑qualification, LLC documentation if applicable, the full title report, and the preliminary closing statement to the lender. From here, the bank will begin its review process, which may include ordering a valuation, verifying the buyer’s qualifications, and reviewing the seller’s hardship documentation.

Why This Process Matters

For homeowners, knowing what to expect keeps you in control and reduces stress, and providing complete documentation early helps speed up bank review. For agents, a well‑organized submission positions you as a professional who makes the bank’s job easier—which can lead to faster approvals and fewer deal‑killing delays.

The Bottom Line

Once a short sale offer is accepted, it’s not time to sit back—it’s time to move quickly. Each step, from collecting buyer documents to ordering title and preparing the preliminary closing statement, sets the stage for lender approval. When sellers, agents, and negotiators work together to get a complete package to the bank early, short sales can move surprisingly fast—and everyone gets to the closing table with less stress.

Ready to navigate your own short sale? Start a Short Sale or learn How We Help with Crisp Short Sales.

How to Win Over a Short Sale Lender: Proven Negotiation Tips

If you want to get a short sale approved quickly, one thing is certain: you’ve got to make life easy for the lender. The faster they can review, the sooner your file moves forward — and the better your odds of getting the terms you need.

Here are my proven tips for m

aking lenders say "yes" more often.

1. Start With a Complete Package

One of the biggest mistakes I see is sending the lender bits and pieces of the short sale file. Every missing document means another delay, another round of emails, and another chance for the file to get buried on someone’s desk.

Send a completehardship letter, financials, offer, preliminary HUD, HOA statements, tax records, and anything else the lender needs. The goal is to make it as easy as possible for the negotiator to finalize their review and push the file to the next stage.

2. Control the Valuation Process

When the lender orders a valuation, make sure it’s an interior appraisal or Broker Price Opinion (BPO), not just a drive-by. Drive-bys miss critical details and often inflate values because the appraiser never sees the inside condition.

And here’s the most important part: don’t let the homeowner open the door. The listing agent should be the one who meets the appraiser or broker, goes over the comps, and walks them through the property’s true condition.

Take the time to explain market dynamics, the repairs needed, and anything else that justifies your pricing. Why? Because when this makes it into the appraisal or BPO report, it becomes part of the lender’s official record — and that can make all the difference in negotiations.

3. Negotiate Closing Costs Smartly

When you send the preliminary HUD, ask for everything up front — transfer taxes, HOA fees, attorney’s fees, repairs, and other legitimate costs.

Here’s a pro tip: slightly overestimate certain costs like property taxes if possible. If the lender comes back asking you to cut somewhere to meet their net requirements, you’ve got room to give without touching the core deal terms.

4. Keep Commission Requests Reasonable

While it’s tempting to push for more, never ask for more than a 6% total commission. Many lenders see a higher number as an open invitation to negotiate — and that often means they come back with something even lower than you wanted. Keep it simple, keep it standard, and avoid the risk of triggering unnecessary cuts.

5. Always Ask for Relocation Assistance

Many lenders will pay the seller a relocation incentive at closing to help with moving costs. It’s not guaranteed, but if you don’t ask, you won’t get it.

This can be a win-win: the homeowner gets help moving on, and the lender knows they’ve smoothed the way for a clean, on-time closing.

Final Word

Winning over a short sale lender isn’t about magic words or secret back channels — it’s about preparation, control, and smart negotiating. Give them a complete file, make sure the valuation reflects reality, and position your numbers so you’ve got room to move.

Follow these steps, and you’ll see more approvals, faster timelines, and fewer headaches for everyone involved.