Don’t lose your home and ruin your credit
Here are some facts you may not know regarding SHORT SALE vs. FORECLOSURES
Sometimes rather than pursing the costly and time-consuming process of foreclosure a lender
will allow a delinquent borrower to sell the house for less than the mortgage amount and
Turn the proceeds over to the bank as payment-in-full. Banks don’t always agree to short
sale-among other thing, they look at the gap between the balance on the loan and the
expected proceeds of the sale and the homeowner’s other assets. Basically, they weigh the
cost of a short sale against the cost of foreclosing and selling the property themselves.
Let’s face it; a short sale will hurt your credit. It’ll subtract 150-200 points from your credit
score. This can stay on your report for 7 years. That’s pretty substantial, But a foreclosure
is even worse- it subtracts about 400 points from your credit score. And Can stay on your
report for 10 years. It’s very difficult to get credit after a foreclosure. And it’s difficult to get
it removed from your credit report, because it’s public record.
If you think that abandoning your house and walking away will solve all your problems,
THINK AGAIN! If you’re upside down and the lender has to take a loss, they will send you
a 1099-C tax form at the end of the year. Their loss(deficiency) gets reported to the IRS as
your income. And you’ll probably have to pay a tax on this income. So it’s to YOUR benefit
to help the lender incur as SMALL a loss as possible. Because that means LESS TAXES
you’ll have to pay to the IRS. Plus with the Mortgage relief Act of 2007, Those that have A
Short Sale January 1, 2007 to December 31, 2012 won’t have to pay taxes on the discounted
loan!
Our office has experience in short sales so you can rest assured knowing you are in good hands.
You’ll know when you’re moving, there’s no need to wonder and worry. We deal directly
with the lender on your behalf. We know what documents the lender will need to consider
your short sale, we will help you get the correct paperwork together and submit it to the
Lender so you can focus your energy on finding your next home.
Please contact me today for a no cost/no obligation consultation of your current situation.
