Seems strange, but maybe not rare?
DH and I cruise realtor.com and other sites keeping track of homes in areas we are considering for retirement. One of them is the Triange area of NC.
So I see a house offered for "preforeclosure sort sale." It says the owners just closed on this new construction home in February but are relocating to improve job siuation (layoff, I guess).
It is on the market for $9k less than their purchase price. The listing price is $325K, their purchase price was $334K.
Now, even if they financed 100% and have a loan pricipal of $334K, for a sale at $325K to be accepted as "short sale" (less than owed) means they don't have $9K + commission in equity/downpayment plus cash, right? That is, a sale at $35K plus 9K would satisfy a 100% loan of $334K. The realtor commission would probably be somewhere in the area of $20K unless it's a discount service. (But would the bank pay a full commission if they are losing money?)
Or maybe the "short sale" thing is designed to create a bidding war?