Short Sale Help And Frequently Asked Short Sale Questions

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We Help You Engage Your Lender. Handle Your Application. Get You Answers.

Why Would A Lender Accept A Short Sale?

Short Sale Negotiation is an art not a science; That’s where we step in. The idea is we work with your lender to agree to a short sale offer because they believe it will net them more money than going forward a costly foreclosure process. Contact us for more information on we can help you.

Can Any Real Estate Broker Effectively Handle Short Sales?

No. A short sale is a very complex transaction. Unlike any other type of real estate sale transaction, a short sale should be handled only by a short sale expert who has substantial experience with the short sale process, understands the short sale timelines and continues to have a strong line of success. You wouldn’t have your general physician perform brain surgery. Well, you can’t expect any real estate professional to be qualified to manage the complexities of a real estate short sale transaction for you. We have helped thousands of clients with their mortgage complications. Have a question? We’ve got short sale answers.

How Do I Control My Short Sale?

Through the process of a short sale, we put you in driver seat of the sale, not the bank. Sleep easier knowing who is buying your home, that you will not be thrown out and spare yourself negative stigma of going through the foreclosure process.

With us, you are able to designate the agent who lists your home and in most cases select the buyers who eventually purchases the home. Need an agent? We’ve got short sale agents in your area.

Disclaimer: In some cases lenders will use short sale auctioning platforms to attempt to obtain other buyers but in many cases your buyer will maintain priority over other buyers unless they are outbid.

Short Sale Vs. Foreclosure

Often consumers will consider whether doing a short sale vs foreclosure iss the better option for them. The decision usually boils down to several factors: Future lending goals, credit impact concerns, and tax implicaitons.

Generally, doing a short sale wins out letting the property go to foreclosure.

If your concerns are future lending, in general, when you want to obtain a loan to purchase  your next property, you will find fewer hurlles if you do a short sale.

You dont’ have to be behind on your mortgage to complete a short sale. Some lending programs (FHA), if you stay current during your short sale, may qualify you afterwards without any waiting periods. This is definitely not the case following a foreclosure.

The lender taking any sort of loss (short sale) will definitely negatively impact your credit but in most cases your FICO will drop fewer points than if your credit is hit by a foreclosure.

Short Sale Tax Implicaitons may vary but the general concept is that your home will sell for more in a short sale than it will at foreclosure auction limiting your tax consequences. If you want to bounce some ideas off of us, contact us,  we can’t give you legal or tax advice but we can often given you information to take to your trusted professionals.

Disclaimer: Homeowner’s situations are all different. For short sale tax/legal questions we suggest you speak to your CPA or a real estate attorney that can advise you on the legal and tax implications for your circumstances.

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Do I Qualify For A Short Sale?

The basic requirements to be prequalied for a short sale are simple. Owing more than your house is worth is the biggest factor. Every homeowner’s details are one-of-a-kind, though the beginning criteria for completing a short sale are:

  • You want to sell your property.
  • You have an underwater mortgage (your mortgage is than your home is worth).
  • You don’t have the funds to pay the shortage.
  • If applicable, you have financial hardship. (Hardships may include: unemployment, divorce/seperation, death of family member, unexpected expenses and medical emergencies or illness.)

Unsure whether you need to short sale your property? Contact our Short Sale Experts for a free no obligation consultation. 

REMINDER: If you owe near what your home is worth you have to still consider deducting what you would pay in real estate commissions, closing costs, and property/county taxes to sell your home.

Will I Get Money From The Short Sale?

Typically the answer is no. There were previously government programs (HAFA) that allowed for relocation assistance but the program ended in 2016. There are few exceptions but unless specifically approved by the lender it is often a requirement that the borrower (seller) not receive any money from the sale of the property since the investor on the loan is taking a loss.

What Is The Short Sale Timeline?

Short Sales can be complicated. Timelines vary on many factors, including but not limited to, the time frame it takes to receive an offer, the requirement of needed items, and the lender’s volume of files being reviewed at any given time. Short Sales tend to be anything but short and the proess is time-consuming.

From several weeks to months (even in some cases over a year) it takes time to get a short sale approved. There’s a lot of bureaucracy spanning layers of management, insurers, and investors that will have to approve the short sale. Working with a short sale negotiator who is familiar with the various requirements of individual lenders will ensure that the process moves as quickly as possible.

Will A Short Sale Stop My Foreclosure?

Your lender does not want to foreclose but is bound by it’s requirements to service the loan according to the terms of the promissory note. A short sale will not automatically stop a foreclosure. A lender may work with you to postpone the foreclosure to let a short sale negotiation take place but there are no guarantees.

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Is Doing A Short Sale Guaranteed?

No one can make you a guarantee not even your mortgage servicer. If you’re behind on your mortgage loan, the lender may proceed with the foreclosure process. Often, lenders want to avoid a costly forecloser and a short sale is an alternative. If you can’t come to an arrangement with your short sale lender it is posisble your house will go to foreclosure unless another type of workout arrangement is reached or the loan is reinstated.

I Have A Second Mortgage, Can I Still Do A Short Sale?

Absolutely. You do have to be aware though that any lender taking a loss will have to be, in most cases (even when at the same mortgage servicers) individually negotiated. This will often change the short sale timelines as often one loan may require another loan to approve prior to their review. All lien holders must agree.

What Are My Short Sale Tax Consequences?

Any time someone forgives your debt it’s like they are giving you money. If someone gives you more than 600 dollars generally they have to 1099 you. The same goes for the investor of the loan you are attempting to short sale. If they cancel, or forgive, your debt the federal and state tax law may consider the forgiven debt as taxable income.

There are additional aspects you may want to consider. Debt cancellation will affect your property’s cost basis. Insolvency or bankruptcy may also alleviate some of the tax burdens of a debt cancellation resulting from a short sale. Before completing a short sale you should speak to a tax professional such as a CPA or Real Estate Tax Attorney.

Can I Stay In My Home If I Complete A Short Sale?

Keeping the property after completing a short sale is unsual and not likely. The lender will often cause the parties to agree that the borrowers (sellers) will not remain in the property. Many sellers move even before escrow or the sale of the house closes. If you intend to continue living in the home considering other workout options may be your best bet. On rare occaisions, you may be able to work out a discounted payoff but would have to pay the loan off in its entirety.

Still Have Questions? We've Got Answers.

With More Than A Decade Of Experience We Can Help Find The Answers To Your Concerns.

Still Have Questions? We've Got Answers.

With More Than A Decade Of Experience We Can Help Find The Answers To Your Concerns.