Facing foreclosure? Consider a ‘short’ sale
It’s often the better option for an owner than foreclosure — but there are pitfalls, including tax liability.
Selling “short” is an alternative to foreclosure that has been gaining popularity as more homeowners default on their mortgages. Susan M. Wachter, a professor of real estate, finance and city and regional planning at the Wharton School of the University of Pennsylvania and assistant secretary of Housing and Urban Development under President Clinton, talked with us about this option. Here is an edited transcript of her comments: