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This is the fastest-growing foreclosure alternative. Banks will rather sell a property short before foreclosing on a property. In a short sale the home sells for less than the amount of the loan. This is attractive for lenders because they lose less money than in a foreclosure.
Homeowners are relieved as the impact on their credit is far less than in a foreclosure, two years, as opposed to seven years for a foreclosure, and often isn't a barrier to purchasing another home. Also unlike a foreclosure there is no deficiency judgment.
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