Southwest Florida Title Insurance & Real Estate Blog -

Step 5: What Happens After A Home Short Sale?

Posted by Chris On August 18

Now that you understand the Mortgage and the Note, you can really understand what happens after…

This is the 5th step in our series “12 Things You Should Know to Survive a Short Sale.”

a home short sale (we’re assuming here for ease that the real estate property was a home).

Both the Mortgage and the Note contain default terms.

The most common of defaults is the borrower’s failure to pay according to the terms of the Note and Mortgage.

When a homeowner defaults on their home loan, their liability is twofold:

  1. In accordance with the terms of the Mortgage, the extent of their liability upon default is limited to their interest in the real property that collateralized the loan amount.
  2. With respect to the Note, the borrower is technically obligated to personally repay the sums borrowed from the lender.

For example, this is a HSBC Short Sale Approval Letter, as receiver for M&I which closed 03/19/2010. The short sale approval came within approximately 60 days from the date of short sale package submission.The original loan amount was for 310k and lender accepted 172k with a commission of 5% to real estate agents.

To accomplish a successful home short sale, the lender must release its Mortgage lien in order for the buyer of the property to have clear title to the property. This incredibly important step in a home short sale is our specialty at Winged Foot Title. It underlies our issuance of title insurance.

12 Things You Should Know to Survive a Short Sale” is a FREE eBook that is available for immediate download at

If you have any real estate or short sales questions – please don’t hesitate to contact us, or call us at (239) 985-4142. We service all of Southwest Florida including: Fort Myers Estero, Bonita Springs, Naples, Cape Coral, Pine Island, Punta Gorda, and Port Charlotte.


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NOT LEGAL ADVICE: This information is not to be construed as legal advice. Legal advice must be tailored to the specific circumstances of each case. Every effort has been made to assure that this information is up-to-date as of the date of publication. It is not intended to be a full and exhaustive explanation of the law in any area. This information is not intended as legal advice and may not be used as legal advice. It should not be used to replace the advice of your own legal counsel.

Winged Foot Tite, LLC is not associated with the government, and our [short sale orchestration] service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan.