Private Mortgage Insurance is associated with Mortgages with less than 20% down on the total Mortgage.  It is usually paid by the buyer

but benefits the bank that gives the loan. In a short sale this means yet another party that is involved in the short sale.

This envolves more time for seller and buyer.  PMI covers part of  the banks loss in a foreclosure. The bank may benefit from a PMI claim.  The numbers are important here.  Where the bank decides to do a short sale depends on the total picture. Will the bank make a claim? Who is the PMI company?  Time and benefit are bank considerations here.

First time buyers with a dead line should be aware.