Commercial short sales are sometimes depended on to avoid the foreclosure of a property when the owner, whether an individual or a corporate entity, is unable to make the necessary payments. While it may come as a surprise for some, the bank or lender actually considers a foreclosure to be the last resort because it is an expensive process and it would be very difficult to sell the property in view of the economic downturn. Banks are not in the real estate business and their focus is on lending money to generate cash flow. A foreclosed property is therefore considered to be a non-performing asset until it is finally sold.Oftentimes, the services of a commercial loan workout professional is required to convince the lender to approve commercial short sales because they usually result in the sale of the property for a price that is lower than the outstanding loan balance. However, if it is shown that the bank will benefit from the transaction because the resulting loss is actually less than the expenses that it will incur in going through with a foreclosure and selling this particular asset, such as an apartment, a warehouse, a hotel, a strip mall, or an office building, it may approve the transaction.Commercial short sales may still negatively affect the owner’s credit score but the impact of a foreclosure is much worse. It should be noted that the difference between the loan balance and the selling price may be forgiven by the bank but this may mean that this would be considered as income and require the payment of income tax. In addition, if the owner does not want to lose the property, a mortgage renegotiation may be considered instead. A loan workout expert can provide the much needed assistance in these negotiations.