Flopping is a fraudulent practice used by fraudsters to undervalue a property intentionally to induce a lender to make a short sale, thereby benefiting the fraudster at the detriment of the property owner and the lender.
Mortgage relief involves the alleviation or settlement of mortgage debt. This can occur through the assumption of mortgage by another party or the repayment of debt. In tax-free exchanges, mortgage relief can be considered as boot received and could have tax implications.
A pre-foreclosure sale is a transaction in which a third-party buyer purchases a property after the underlying mortgage has been posted for foreclosure but before the property has been repossessed by the lender or liquidated to pay the debt.
A short sale is a financial arrangement where a mortgagor settles their outstanding mortgage debt with a payment that is less than the principal balance owed. This process helps avoid foreclosure and can be used as an alternative solution for struggling homeowners.
