The Mortgage Forgiveness Debt Relief Act of 2007 is Expiring

So what are other homeowners doing? Many homeowners that are considering a short sale or a loan modification have decided that instead of waiting for the market to come back they are opting to sell their house now and get out while the getting is good!  If you owe more than your house is worth, it will take years to break even. If you decide to sell your house BEFORE you break even, there will be debt that is settled by the lender. Pursuit of a short sale AFTER this deadline expires will be subject to additional tax liability.

There are many circumstances that will determine if a lender provides "Cash For Keys".

But in this particular case, the sellers did very well.  Beats foreclosure hands down.

6/24/11

Mark,

Thank you so much for all you did for us at a really stressful time.  You and Sam were on top of everything and had answers when we called you.  These are some important points that happened as we were going thru a short sale.

                Foreclosure sale date was postponed.

                Lender did not hold us responsible for the deficiency of the note.

                We received $23,000 at closing for participating in the short sale process.
                $3,000 from the HAFA Program and $20,000 from Chase.

If you know of others that are going thru the same circumstances they can call us if they would

like.  You have are numbers.

Sincerely,

Walt & Marlene Klein

Short sale misconceptions and myths that could end up costing you a great deal

#1 - Short sales never close or take way too long to close  

We pride ourselves in our short sale negotiation skills and are able to close short sale transactions in as little as 30 days. New regulations are making it easier to complete short sales and are forcing banks to respond to a short sale offer in a more timely fashion.There are many advantages to doing a short sale vs foreclosure. You want to consider those before buying into these common short sale misconceptions.

#2 - Lenders prefer to foreclose on a home then agree to a short sale

The foreclosure process isn't cheap and costs the banks a great deal of money. Therefore, the banks do their own market research and determine the market value of the home. They then figure out what they'd net if they foreclosed and re-sold the home. If the bank will net more in a short sale (even if the payoff will be discounted imensely) they will agree to the sale.

#3 - If the seller is not in default the bank will not approve a short sale

The bank's decision to approve a short sale is determined by the value of the home and the seller's hardship. A seller may be struggling to make the monthly payments on their home, but are current on their payments and due to their hardship still qualify for a short sale. Hardships include things like loss of a job, decress in income, job transfer, serious illness and medical bills, divorce, monthly cash-flow shortfall, and lack of liquid assets. The seller's in default might receive more immmediate attention, but that doesn't mean those not in default won't qualify as well. The bank will consider the short sale if they can see you are not going to continue to be able to afford your mortage. Therefore, you should not wait until you are in default to try a short sale. It is better to get started right away.

#4 Short sales really aren't a big bargain to buyers

Banks may take a minimum of 90% of the market value, but that can work out to be a great deal of savings to the buyer. Buyers should also keep in mind that short sales are usually in much better condition than foreclosures, which is a large savings in itself.

#5 - Agents don't make as much commissionon a short sale transaction

Banks have moved away from reduced commissions to a more traditional commission for Real Estate brokers. Fannie Mae established a new compensation policy in Feb. 2009 which allows them to pay the commission that the listing agent and seller agreed to pay, as long as it is not more than 6%. Many banks are following suit.

#6 - There is not enough time to complete a short sale

Many sellers have their foreclosure date quickly approaching and assume that means they can't sell their home fast enough to consider a short sale when in fact some banks will stall the foreclosure if they know the seller is making a good effort to sell their home. Often the Realtor can buy some time by calling the lender and asking that the foreclosure date be posponed. Many banks will agree to this and postpone the foreclosure, especially if there is a contract in place.