Before a lender will approve a short sale, the borrower must usually demonstrate what?

In the context of a short sale, the borrower must typically show that the property was listed for sale at a reasonable price. This requirement helps verify that the borrower is taking the necessary steps to sell the property and that the sale is being conducted in a way that reflects the market value of the property. A reasonable listing price indicates to the lender that the borrower is genuinely trying to sell the property and not merely trying to offload it without due diligence, which might otherwise affect the lender's recovery of funds.

This process involves listing the property on the market for a certain period and often includes evaluations from real estate agents to confirm that the price aligns with market conditions. Demonstrating that the property has been listed appropriately helps the lender understand the borrower's situation and can influence their decision to approve the short sale request.