What is a common feature of a short sale?

A common feature of a short sale is that the lender agrees to accept less than the owed amount on the mortgage. This situation typically arises when a homeowner is unable to continue making their mortgage payments, and the market value of the property has fallen below the outstanding debt. In a short sale, the seller negotiates with the lender to sell the property for a price lower than what is owed. This allows the seller to evade foreclosure and gives the lender a chance to recover some of the loan amount, even if it is less than what was initially loaned.

The other choices do not accurately reflect the nature of a short sale. For instance, buyers in a short sale may not necessarily pay a premium price; in fact, they commonly purchase the property at a lower market value. Additionally, short sales are not exclusive to any particular type of buyer, such as investors. Lastly, short sales are not limited to foreclosed properties since they can occur prior to a foreclosure when the lender agrees to the sale terms. Therefore, the essence of a short sale revolves mainly around the lender's acceptance of a lower payment than the mortgage balance.