That Does Not Mean the Short Sale Is Approved
The seller can accept an offer before the affected lienholder has approved the short payoff.
COLORADO SHORT SALE REALTOR
Colorado Short Sale Realtor: The Short Sale Process, Step by Step
Owe more than your home will sell for? A short sale lets you sell it anyway. Your lender agrees to take less than the loan balance and releases its lien, so the sale closes before a foreclosure does.
The Kenna Real Estate Group lists the home. Our negotiator, ShortSale.co, works your file with every lender. The lender pays the negotiator at closing. Call 303-955-4220.
Find Out What Is Still Pending
One mortgage, a second loan or another recorded lien can affect what must happen before closing.
Short Sale Does Not Automatically Mean “As-Is”
Inspection rights come from the contract. Repairs, credits or price changes can still affect the short-sale approval.
Know Whether Another Clock Is Running
If foreclosure has already started, do not assume a proposed short sale automatically stops that process.
WHAT YOUR SHORT SALE REALTOR DOES
What a Colorado Short Sale Realtor Does for You
Your lender approves or denies the short sale. We run everything around that decision.
- Runs your numbers first. A Smart Pricing Report puts the home's value next to every loan, lien and cost of sale. You see the gap before you decide anything.
- Opens your file with ShortSale.co. Our short sale negotiator works with every lienholder: first mortgage, second mortgage or HELOC, HOA and judgment liens. The lender pays their fee at closing.
- Lists the home as a short sale. The standard Colorado listing contract plus the Short Sale Addendum, marked as a short sale on the MLS.
- Keeps the buyer in the deal. We collect offers, meet the lender's appraiser or BPO agent with comps and a repair list, and hold backup offers until the approval letter arrives.
- Sends you to free counseling on every option, including keeping the home. Colorado Foreclosure Prevention Hotline: 1-877-601-4673. HUD housing counseling: 1-800-569-4287.
Short sale in Denver? See Denver short sale help. Buying one? See short sale homes for sale.
SHORT SALE PROCESS IN COLORADO
The Short Sale Process in Colorado, Step by Step
Eight steps from the first call to the closing table. The lender, the number of liens and how fast you return documents set the pace. Nobody knows the closing date until the approval letter arrives.
- STEP 01
Call us and run the numbers
We compare the home's value to what you owe plus commission, closing costs and every lien payoff.
Same day.
- STEP 02
Open your file with ShortSale.co
You sign in to their Pilot portal with your mobile number and see every update on your file. You pay nothing for the negotiation.
Week one.
- STEP 03
Gather your documents
Hardship letter, pay stubs or benefit letters, the two latest bank statements, your latest tax return and the lender's own application. ShortSale.co gives you your lender's exact list.
Start on day one.
- STEP 04
List the home
Colorado listing contract plus the Short Sale Addendum (SSA39). FHA loans: the lender's as-is appraisal comes first, and the list price starts at or above it.
FHA: at least 15 days on the MLS before offers are reviewed.
- STEP 05
Accept an offer
The buyer signs the Contract to Buy and Sell Real Estate with the Short Sale Addendum (SSA38). Buyers inspect before the file goes to the lender.
Fannie Mae loans: 5 days on the MLS, including a weekend, first.
- STEP 06
Submit to every lender
ShortSale.co sends the signed contract and your package to each lienholder by the contract's submission deadline.
You answer each lender request within 5 days.
- STEP 07
Valuation and negotiation
The lender orders a BPO or appraisal. We meet it at the home with comps and repair photos. ShortSale.co negotiates the payoff, the second liens and the release of the remaining debt.
Fannie Mae: a decision within 30 days of a complete package.
- STEP 08
Approval letter and closing
The letter states the approved price, the closing deadline and whether you are released from the remaining balance. We close by that date, exactly on those terms.
Fannie Mae: close within 60 days of approval.
OWE MORE THAN IT IS WORTH?
Get a Quick Value. You May Be Underwater.
Bought in 2022 or 2023 with FHA or VA and little down? Prices in parts of Colorado sit below those purchase prices today. Check your value first. A free Smart Pricing Report shows your price, your payoff and your net in 24 hours.
Home value by city: Centennial · Highlands Ranch · Littleton · Lone Tree · Castle Pines · Castle Rock · Parker · Aurora · Lakewood · Arvada · Colorado Springs · Fort Collins
START WITH THE TRANSACTION
Is It Actually a Short Sale?
A discounted price, low equity or the words “lender approval” do not automatically make a property a short sale.
The important question is whether the sale proceeds will be insufficient to satisfy one or more liens and an affected lienholder must agree to accept less than it is owed in order to release its lien for closing.
That distinction matters because a short sale is still a sale by the current homeowner. It is different from buying a home the lender already owns after foreclosure.
Four questions establish where the deal stands
In a short sale, yes. The property has not simply become bank-owned because a mortgage problem exists.
That establishes an agreement between buyer and seller. It does not necessarily establish lienholder approval.
That is the additional layer that separates a short sale from an ordinary resale.
If it has, the short-sale effort needs to be considered alongside the actual foreclosure dates and notices.
FOR BUYERS
Buying a Short Sale in Colorado
A short-sale price can get your attention, but price alone should not drive the decision.
The useful comparison is the home’s price and condition plus the approval process, financing, inspection costs and timing against other homes you could buy without the additional short-sale layer.
Seller Acceptance and Lienholder Approval Are Different
You can have a signed contract with the homeowner while approval from the seller's mortgage holder or another lienholder is still outstanding.
Before planning around the transaction, find out:
- whether the short-sale package has actually been submitted;
- which lienholders still need to respond;
- whether written approval has already been received;
- whether the approval contains conditions that could change the transaction; and
- whether foreclosure has already started.
Ask Which Liens Have to Be Resolved
The first mortgage is not always the only claim against a property.
A second mortgage, home-equity loan, judgment, tax lien or another recorded lien can affect the amount needed to deliver clear title. Title work helps identify what is actually recorded against the property.
The practical buyer question is not simply, “Did the bank approve it?”
It is:
“Does everyone who must release a lien for this closing have an acceptable path to doing so?”
Do Not Confuse the Seller's Lienholder With Your Lender
A financed short sale can involve two completely different lending decisions.
The seller's lienholder decides whether it will accept the proposed short payoff and release its lien.
Your mortgage lender decides whether you and the property meet the requirements for your financing.
A short-sale approval from the seller's lienholder does not replace your appraisal, underwriting or property-condition requirements.
CURRENT POSSIBLE MATCHES
Want to See Which Colorado Listings May Be Short Sales?
Use the current listing search as a starting point, then confirm the actual sale status before relying on the label, price or closing timeline.
FOR HOMEOWNERS
Selling When the Proceeds May Not Cover What You Owe
Start with the sale math before assuming you need a short sale.
Estimate the property's current market value, then compare likely sale proceeds with the mortgage payoff, any second mortgage or home-equity balance, other liens and the costs required to sell.
A low-equity sale can still close normally if all liens and closing obligations can be paid.
A short sale becomes relevant when an affected lienholder would need to accept less than it is owed or otherwise approve different treatment of the debt so its lien can be released.
Start With the Home's Current Market Value
The first useful number is not what you paid for the home or what you still owe.
It is what the property is reasonably likely to sell for in its current condition.
Use a Home Value Review to begin comparing estimated market value with your payoff and likely selling costs.
Contact the Mortgage Servicer Early
If the numbers suggest the sale may come up short—or mortgage payments are becoming difficult—contact the company servicing the loan and ask specifically about available loss-mitigation options.
The servicer may request financial information, loan documents, hardship information, a purchase contract and other documentation before deciding whether it will consider a short sale.
Do not intentionally miss a payment because someone told you that you “have to be behind” to short sell. Requirements can depend on the loan, investor and servicer. Get the answer for your actual mortgage.
Find Out What Happens to Any Remaining Debt
Releasing a lien from the property and forgiving the remaining debt are not necessarily the same thing.
If the short-sale proceeds will not satisfy the full balance, ask the servicer exactly what will happen to the unpaid amount.
When a deficiency is being waived, obtain the waiver in writing and keep it with the transaction records. Legal, tax and credit questions about remaining debt should be reviewed with the appropriate qualified adviser.
KNOW WHICH SALE TYPE YOU FOUND
Short Sale, Foreclosure, REO and HUD Homes Are Different
These terms often appear near one another, but they describe different situations.
Short Sale
The current homeowner is selling, but one or more lienholders must approve a payoff that will not satisfy the debt in the ordinary way.
The owner has not simply handed the property over to the bank.
Foreclosure and REO
Foreclosure is the process used to enforce a defaulted real estate loan.
REO, or real-estate-owned property, generally refers to a property owned by a lender or other institution after the prior ownership has ended.
If that is the sale type you are considering, use the Foreclosures and REO guide.
HUD Home
A HUD home is government-owned inventory sold through HUD's property-disposition process. It is not simply another name for a short sale.
Read the Colorado HUD Homes Guide, or browse current HUD Homes for Sale.
Distressed Property
“Distressed” is a broad search term rather than one precise transaction type.
It can lead you toward short sales, lender-owned homes or other properties where condition or financial circumstances affect the sale.
Use the Distressed Homes guide when you want to compare the broader category.
If you are comparing these opportunities with conventional purchases and other buying strategies, continue to Ways to Buy.
OFFICIAL GUIDANCE
Colorado and Federal Short Sale Resources
Short-sale decisions can involve real estate, mortgage-servicing, legal, tax and credit questions. These official resources provide additional guidance:
- Consumer Financial Protection Bureau: What Is a Short Sale?
- HUD: Avoiding Foreclosure
- Colorado Division of Real Estate: Understanding the Colorado Foreclosure Protection Act
This page provides general real estate information. It is not legal, tax, credit, mortgage-servicing or financial advice.
QUESTIONS BUYERS AND SELLERS ACTUALLY ASK
Colorado Short Sale FAQs
The seller accepted my offer. Is the short sale approved?
Not necessarily.
Seller acceptance establishes the deal between buyer and seller. If the sale requires one or more lienholders to accept less than they are owed, their approval is an additional step before the transaction can close as proposed.
Can the seller's lienholder ask for a different price?
The lienholder can approve, reject or place conditions on the proposed short sale.
If its required terms differ from the contract the buyer and seller signed, the parties need to determine whether they are willing and able to proceed on the revised terms.
Is the short-sale list price already approved by the lienholder?
Do not assume it is.
Ask whether the asking price or a previous offer has actually been reviewed by the affected lienholder and what, if anything, has been approved in writing.
Can I inspect a short-sale home before approval?
A short sale does not automatically remove a buyer's inspection rights.
The better question is when the inspection occurs under the contract and whether you are comfortable spending the inspection money before final lienholder approval.
Are Colorado short sales always sold as-is?
No.
“As-is” terms depend on the listing and contract. However, repairs, credits, concessions or price reductions can affect the amount the lienholder receives and may complicate an approval that has already been issued.
How long does a Colorado short sale take?
There is no useful one-size-fits-all timetable.
The servicer, mortgage investor, number of liens, completeness of the seller's package, requested terms and foreclosure status can all affect the process.
Instead of planning around a generic number of weeks or months, ask where the specific file stands and what remains unresolved.
Does a short sale automatically stop a Colorado foreclosure?
No.
If foreclosure has already begun, confirm the actual foreclosure status and deadlines rather than assuming short-sale negotiations have stopped them.
Does a short sale automatically forgive the remaining mortgage balance?
No.
A lien can be released so the property can transfer without necessarily resolving every question about the borrower's remaining liability.
If a deficiency is being waived, get that agreement in writing and have legal or tax questions reviewed by the appropriate adviser.
Do I have to stop making mortgage payments before asking about a short sale?
Do not intentionally miss payments based on a general rule from the internet.
Short-sale and loss-mitigation requirements can depend on the mortgage, investor, insurer and servicer. Contact the servicer and ask about the options and eligibility requirements for your actual loan.
Is a short sale always a better deal for the buyer?
No.
Compare the approved purchase price, property condition, repair needs, financing, inspection costs and time involved with the other homes available to you.
A lower-looking price is useful only if the complete transaction still works.
PROPERTY-SPECIFIC SHORT SALE HELP
Bring Us the Listing—or the Numbers Behind Your Home
If you are buying, send us the property address and what you have been told about the short-sale approval.
If you are selling, tell us the approximate value, what you owe and whether you have received any foreclosure notices.
Kenna Real Estate Group can help with the real estate side of the decision: market value, comparable sales, listing strategy, offer terms, property condition, title coordination and transaction timing.
Your mortgage servicer and qualified legal, tax, credit or housing advisers should handle questions outside a real estate broker's role.
Buying a listing, considering a short sale on your own home, or already dealing with a foreclosure deadline? Tell us what is happening and what you need to figure out.
Ask About a Short Sale