Q. What is a "short sale" request?
A. A short sale request is when our company asks the Lender if they would take a discount on the amount that is owed on the property. This may allow you to sell your property for less than you owe the bank.
Q. Why does the short sale process work?
A. Your mortgage company runs different scenarios on your property to determine what they will get from a short sale versus foreclosure. Your mortgage company takes the following factors into consideration: -The foreclosure process and attorney financial cost. -There are holding costs involved i.e. how long will the house stay on the market?-They may have to make repairs on the property. -They have to carry property insurance.
Q. What about tax consequences?
A. Debt forgiveness may be considered taxable income. However, if this is your primary residence, you may be exempt from any tax consequences.
If this is a second home or investment property, your capital loss may offset your income from forgiven debt. This is a question your accountant can answer.
Q. Do I have to be late on the mortgage payments?
A. NO. There are 5 reasons a lender can accept a short sale, and being late is not a requirement. The lenders would sometimes rather work with the homeowner who hasn't fallen thousands of dollars behind. The lenders would rather find a solution before payments have stopped being made.
Q. How long does everything take?
A. The short sale process is a complicated one. The entire process generally takes about 30 to 120 calendar days, but can take longer depending on the amount of foreclosures a particular lender is handling in a given month. Our goal is to get everything done as quickly as possible so that you can get on with your life without having the threat of foreclosure hanging over your head or having a foreclosure appear on your credit report which could affect your ability to lease or buy a home in the future. The most important part is your ability to help us get any paperwork the lender may require before they agree to a short sale.
Q. I'm currently in bankruptcy. Can you still help?
A. Yes. But we cannot negotiate a work out agreement with your lender until your mortgage has been discharged from the bankruptcy.
Q. I still have questions, who can I talk to?
A. We will work directly with your Realtor, but you are welcome to call one of our negotiators as well.