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Short Sale Specialist
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HAVE YOU RECEIVED A FORECLOSURE NOTICE?


What is a Short Sale

A homeowner may be able to sell their home for less than what they owe the Lender.

When lenders agree to do a short sale, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs.

The forgiven debt may be taxable income. The seller should discuss this matter with a tax accountant as there are situations where your income would not be taxed.

Short Sale

A short sale is a better option because it does not affect your credit as negatively as having a foreclosure on your credit report.

Advantages of Short sale over Foreclosure

Your credit score will be affected less adversely than with a foreclosure. FHA guidelines has reported that a homeowner having sold their home as a Short Sale can be in a buying position in as little as two years, whereas foreclosure will be years longer. In a letter dated as of December 16, 2009 FHA has revised the guidelines for short sales effective immediately:

“... borrowers are considered eligible for a new FHA-insured mortgage if: 1) they were current on their previous mortgage and other debts at the time of the short sale and 2) if the proceeds from the short sale serve as payment in full. "We also stated that borrowers are not eligible for a new FHA mortgage if they pursued a short sale agreement to take advantage of declining market conditions, or to purchase another property at a reduced price. Additionally, borrowers who execute a short sale while in default on their mortgage are not eligible for a FHA-insured mortgage for three years from the date of the sale. Lenders, however, can make exceptions if the default was due to circumstances beyond the borrower's control, such as the death of the primary wage earner.”, as reported by Assistant Secretary for Housing/FHA Commissioner".

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