Facing Foreclosure – You Have Options

If you are having trouble with your mortgage or need to move and are worried about your home value – please contact us. We are up-to-date on the latest REALTOR certifications for this challenging time with Short Sale and Foreclosure Certification. Everything is always confidential, and there may be other options for you, like a short sale.

In a declining market, short sales are common when homeowners owe more on their mortgage than their property is worth. Because of this deficit, owners suffering from financial hardships cannot sell to avoid foreclosure. A short sale, also referred to as a pre-foreclosure sale, is becoming an increasing part of the real estate market. In a short sale, the mortgage lender agrees to accept less than the mortgage balance due to the mortgagor’s economic or financial hardship. A short sale typically occurs to prevent a home foreclosure, which also costs the mortgage lender a substantial amount of money. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales.

A short sale adversely affects a person’s credit report, though the negative impact is typically less than a foreclosure. Usually, when a lender decides to forgive all or a portion of a borrower’s debt and accept less, the forgiven amount is considered as income for the borrower and is liable to be taxed. There is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. Anyone considering short sales should consult a real estate lawyer and a tax accountant to discuss any ramifications.

The short sale process typically begins by listing your home for sale for less than the balance on the mortgage with the condition that the lender must approve all offers. Once you receive an offer on the property, the lender’s negotiations begin to try and resale the home to the new buyers. If you or someone you know needs a consultation on their options for selling their home, whether distressed or not, please feel free to contact me. I am SFR (Short Sale and Foreclosure Resource) certified and can help show you your options.

Tina Marr, REALTOR® , GRI, SFR Certified, RE/MAX PRESTIGE 

 This is intended to provide basic information. Please consult your legal and tax professionals for specific questions based on your circumstances.