People are losing their homes to foreclosure everyday, the housing market is in a chaotic state with no end in sight, and no one is sure what to do. If you are trying to deal with a situation like this, you know how very hard it is.

If you can get your lender to work with you, you may be able to save your home. Lenders now realize that they will benefit more by offering you means to keep your home. They may throw options at you, like mortgage refinancing or loan modification to help you get caught up.

Some people go through such a crisis that it is hard to get out of it. In that case the best option would be sell your home and pay off the debt. Although the value of property is not high these days but you will be able to pay off your credits at least. You may not be able to make any profit but you will feel relaxed.

But what happens when your mortgage balance is more than your home is worth? What do you do if your house is on the market and the only offers you get fall short of paying off what you owe? This situation is what is known as a short sale.

What is a real estate short sale? In the event of a short sale, the lender determines if the sale of the home will proceed. If the lender approves the offer, the proceeds of the sale are turned over to them; they put the amount towards the balance and discount or forgive the rest of the balance. They then proceed with the closing of the sale.

Real estate short sale occurs only when your loan is already in a defaulted condition. If your loan is not in default condition then there is no chance that you would qualify for a short sale. It is also to be known that just because you are a defaulter of your loan it doesn't mean that you are eligible for a real estate short sale automatically. There are many things that are to be considered for getting approval for a short sale and it is not that easy too.

Having financial hardships is a strain on anyone. It feels like you are the only one, but you are not. This could happen to anybody, anywhere. No one truly knows what it is like, unless they have been through it. It is advised that you receive the proper financial counseling to help you through it. They can inform you of your rights and advise you on what to do next.