 |
| |
| |
 |
|
Definition
of a Short Sale
A short sale occurs when you sell
your property for less than what is
owed on it. This requires your
lender or lenders, if you have
multiple mortgages, to approve the
sale before it closes. Most lenders
will allow a short sale provided
certain conditions are met. |
|
Essential
Conditions Must Be Met for a
Successful Short Sale
- Inability
to sell the property at an amount
equal to or exceeding your mortgage
balance.
- Hardship must be established.
- Difficulty making mortgage payment.
|
|
|
|
|
YOU ARE NOT ALONE
AT THIS DIFFICULT TIME. RIGHT NOW,
THERE ARE THOUSANDS OF HOMEOWNERS, IN YOUR
COUNTY ALONE,
FACING FORECLOSURE. |
|
Why Do A Short
Sale?
There are several benefits to a short sale.
First and foremost is the negotiation for
forgiveness of debt. In most instances, the
lending institutions agree to non-pursuit of
deficiency judgment or charge off. In these
circumstances, the lenders will agree,
through negotiation, to accept full
settlement with no further monetary
obligation from the borrower/ homeowner. On
the other hand, there are circumstances in
which the lender and their respective
investors may require a fractional repayment
of their losses, most commonly in the form
of a deficiency note. These cases may
surface when the subject property is
non-owner occupied or if the borrower/
homeowner had used the property to obtain
large sums of money, by means of cash-out
refinance, for personal gain. As a
negotiation process, a short sale is
intended to achieve the most beneficial
outcome for both the borrower/ seller and
the lender/ investor. In any case, short
sales yield substantial benefits over
foreclosure for all parties.
When a lender/ investor accepts less than
the balance owed on a loan made by them, a
1099-C is issued to report deficiency
balances as “income earned” to the IRS. With
current federal debt relief programs, many
cases may institute the reduction or
forgiveness of federal income taxes that
would otherwise be due for deficient
balances. Although these scenarios do not
apply to all short sale transaction
workouts, the foreclosure process is
guaranteed to produce the most detrimental
outcome to anyone's financial integrity.
|
Short Sale
Benefits All Parties
A short sale can yield the best results for
all involved. By agreeing to the terms of a
short sale, the lender stands to cut their
costs and time involved in foreclosing and
remarketing the property. Foreclosed
property typically sells under market value
and losses are generally greater. By selling
under a short sale contract, borrowers are
benefited with debt and negative credit
relief.
Your Benefits
- Forgiveness of debt in whole or in part
- Relinquishment of tax obligation
- Bankruptcy alternative
- Weighs much less on credit as
apposed to foreclosure
- Piece of mind over abandonment and
legal ramifications
|
 |
| |
|
|
|
| |
|
