# Enforcement method of short contract

A stock short seller promises to pay back a stock at a certain date, but what is the mechanism that actually forces them to buy the stock?

I've read that it is the broker who will do a margin call and buy the stock for them, but that seems only to redefine the question, since the broker is then forced to buy the stock.

Lets say you have a contract for shipment of an item. The seller promises to deliver in 7 days, but you need to write into the contract "WHAT IF" sections for if the seller neglects to do so, for whatever reason. That could be fees, penalties, etc.

So, say the short seller (or broker, or whoever) neglects to purchase the stock, do they owe the other party "all their money", "the price of the stock at a certain instant", "penalties/interest for the X days the stock is not purchased (until bankruptcy of the short seller)"?

There is no contract when someone shorts a stock in U.S. market nor does he have to pay back a stock at a certain date.
2. The other reason why a short seller is forced by his broker to close his short position is failure to maintain sufficient margin. If on Reg T MMR of 30%, you have about 15% of buffer (price rise) before you reach the MMR. After that, you must deposit $1.30 of cash or marginable securities for every dollar the equity rises. So for example, if you short 100 shares at \$20. A bit above \$23, you'll need to add more margin. After that, for every \$1 that the stock rises, you'll need another \\$130 of margin in your account to keep your short position open. This becomes more of a problem if your broker raises its margin rate as some did before the November election as well as this past week when they raised it for GameStop.