Short Sale -

A Short Sale is a closed transaction where the mortgage holder(s) agree to accept less than the mortgage amount balance to allow the homeowner to sell the property when in a hardship situation. A Short Sale is an option for a homeowner who is unable to make their mortgage payment yet their property value has dropped below what a buyer would be willing to pay in the current market . A Short Sale allows a homeowner to sell their property instead of losing the property in foreclosure because of their inability to make the mortgage payment.

Loan Modification - 

A mortgage modification is a process through which your mortgage lender changes any or all of the following:

• Your interest rate
• Your principal balance (through a reduction)
• Your loan terms (example: from an adjustable to a fixed rate)

This process can allow borrowers to stay in their property when they can no longer afford their current mortgage payments.