A friend of mine told my mom her house was in short sale. I have never heard of this. Is this like a foreclosure? I think she is in serious trouble, and I am so worried for her. She said she they (mortgage co.?) has refused her last 3 payment attempts. (Can they refuse you like that?)

The really bad part is, I don't think she has told her husband. He's been working so hard. They've been struggling for months. I'm really scared for them.

I read that this short sale is like when the bank decides to sell the house for less than what is owed on the mortgage, at a loss. Say they owned $10,000; they bank would sell it for $8,000, at a $2,000 loss. I know that much. But I don't see what is the point, except for when the person can't make their mortgage payment. Maybe the bank does this to try to at least recoup as much as they can now, since they know no payments will be coming in, so they go ahead and sell the house right from under you, at a loss. But the loss would probably be a lot less now than it could be in the future. Do I understand this right?

How long does this short sale take? Is someone going to show up at her house from the bank with a notice or something? A sign to nail on the front door? Have they already lost their home? Will they only have like 30 days to get out? My God, they have SO MUCH property there, cars, trucks, trailers, little sheds they've built, LOTS of large dogs, cats, above ground pool, OMG, what a mess.

I am feeling really scared for my friend.