Woodland Hills, CA December 27, 2007- In March 2007, P.J., a soldier in the US Marines, received a notice that he would be stationed in Iraq in July. He and his wife, residents of Virginia, decided she would stay with her parents in a different state while he was gone. Not sure about his future and facing an unclear economic situation, P.J. realized he must sell their house before he leaves overseas. However, the value of the house had decreased significantly since the original purchase price. It was now worth less than what he owed to the lender, American Servicing Company (ASC). P.J. had no way to keep the house and no longer had equity in it.

Seeking an appropriate solution, P.J. approached I Short Sale, Inc. for help, a default servicing company. I Short Sale, Inc, the leading nationwide short sale firm, listed the property at the fair market value and found the buyer. When ISS then approached ASC, the company declined the short sale, requiring that P.J. be in default for at least two months prior. P.J. refused to risk that path. He wished to save his credit so that when he returned from his service abroad, he could soundly buy a new house. However, ASC insisted that while he is still current, short sale is not an option. Striking back, P.J. wrote to ASC as well as to government officials and senators, stating profoundly that "I might lose my life serving our country. Why do you want me to lose my credit as well?" Receiving no positive reply, P.J. left for Iraq, his wife to her parents, and the empty house awaiting the bank's needless foreclosure. It is ironic that a soldier serving his country would receive so little in return.

2007 proved to be a difficult year in real estate, with an overwhelming quantity of foreclosures and unsold homes. Lenders must begin to recognize alternate forms of loss mitigation, such as the services. Otherwise, the numbers will only continue to rise, and the real estate market to decline. Homes are losing their worth, placing homeowners in unpleasant, and often desperate situations, as they owe money they don't have, on a house with no equity. Short sale permits lender and borrower, in this case ASC and P.J., to reach a profitable agreement. By selling the house at a more reasonable price, and saving the lender money on foreclosure fees, legal fees, etc., short sale proves to be the most effective foreclosure prevention method. Lenders could afford to take advantage of this tool. Most importantly, short sale would allow P.J. more control over his property and a legitimate way to save his credit. He would be able to return assuredly from Iraq, with the means for a fresh start.