The web reference at the bottom is for a very informative article about the short sale package.
If you are a short seller, you must be undergoing hardship not of your own making. such as illness, unemployment or natural disaster.
I know of no exceptions to the policy of almost every bank and mortgage lender to require proof of financial hardship before allowing a residential short sale, and entirely forgiving the borrowers debt.
They would allow you to sell and pay the difference between the debt and the net in cash at the close of escrow.
If you are not in hardship but don't have cash assets, a bank might allow you to transfer the unpaid portion to a personal loan, or a loan secured by other assets.
An investor or homeowner who made an unlucky investment, can't expect relief from a short sale
The article linked below tells you a little about the patience and risk tolerance required from a buyer and a seller in a short sale situation. My opinion of short sales for buyers? High Risk, Low Reward.
To sum up the article. 1. Buyer waits a long time for the bank to anything. 2. Buyer has to sign banks counteroffer that is full of anti-consumer clauses. 3. Buyer has to pay nearly full market value. (discount, if any is much tinier than you think it will be) 4. Bank can cancel the sale at any time up until close of escrow, with no consequence to the bank and no compensation to the buyer
In my not so humble opinion ( imnsho,) ) The reasons why the failure is above 80% are:
1. Many sellers don't qualify, they think that being upside down and hating it is enough.
You must also be undergoing hardship not of your own making. such as illness, unemployment or natural disaster. Stovall gives a few other reasons.
2. Prospective buyers think that these are bargains, so very few buyers offer close to full market value. The banks will not approve sales at huge discounts, tiny discounts: yes.
3. The wait, 4. the paperwork, the wait 5. the anti-buyer addenda, the long wait 6. the uncertainty of the sale, still waiting 7. the perception, if not a reality, of bad faith dealing by the bank loss mitigation managers.
.I linked below to an article in Broker Agent News by Steve Stovall. He gives a pretty good description of the short sale process, seller, property, paperwork, and buyer requirements