What is Seller / Cash Contribution?
A seller or cash contribution is money the lender asks the homeowner (or sometimes the agent) to bring to closing as a condition of approving a short sale, especially when the seller has some ability to pay. It can be a lump sum or a promissory note for a portion of the shortfall. Not all short sales require one.
Example: The bank approves the short sale on the condition the seller signs a $5,000 promissory note as a cash contribution toward the deficiency.