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Short Sale Specialist's Blog

By Mike Linkenauger | Real Estate Pro in Jacksonville, FL
  • San Diego County, CA Short Sale Specialist

    Posted Under: Home Buying, Foreclosure, Credit Score  |  September 30, 2013 11:01 AM  |  893 views  |  No comments

    San Diego County, CA Short Sale Specialist

     Stop Foreclosure

    What is a real estate short sale in San Diego County?

    A quick sale in real estate, also commonly called a short sale, happens when a lender is willing to accept a lower payoff on a loan than what is currently owed due to the borrowers inability to continue making payments.

    What does it take to qualify for a San Diego County, Short sale?

    over dueWhile lenders seem to be easier to work with lately regarding qualifications, there are usually three borrower qualifications that most lenders require for a San Diego County, short sale.

    1. Negative Equity - The proceeds from the sale of the property, after all closing costs are paid, are less than the amount currently owed on the property,
    2. Financial Insolvency - Financial insolvency means that the borrower has no other assets that could cover the deficiency (the difference between what is owed on the property and the proceeds from the sale)
    3. Financial hardship - Financial hardships that are acceptable do vary some from lender to lender, but the most common ones are; divorce or legal separation, loss of employment or reduction in income, job transfer or relocation, incarceration, medical emergencies or major medical expenses, death of a family member, vacant rental properties, damaged property, just to name a few. Most lenders believe that a short sale is not for home owners who simply want to sell, but for those who have to sell.

    Is it possible for me to get money back for completing a short sale?

    Until recent times, it was almost unheard of for a home owner to get money back in a short sale. Things have changed for the better. The HAFA program, backed by the US Government, allows homeowners $3,000 to use towards relocation expenses. In addition, some lenders will offer generous incentives of their own in addition to money offered through the HAFA program. We have seen home owners get as much as $35,000 back to complete a short sale.

    Who will pay the San Diego County short sale Realtors© commission?

    In a short sale it is customary for a lender to cover all fees associated with the sale of the property, including your San Diego County, short sale specialist as well. In almost all cases, a home owner in hardship will pay no out of pocket expense to complete a short sale transaction.

    How Can a San Diego County short sale specialist help me?

    As a San Diego County, short sale specialist, I have helped many home owners who are in a difficult financial season get a fresh start with a short sale. Short sales are not part of our "basic training" as real estate agents, and are something that should only be left to those of us who are especially qualified and experienced. Experience is everything when it comes. I'll not only market your home in the traditional manor, but will guide you through this transition while simultaneously processing the short sale with your lender. Visit my website for more information on the short sale process.

    John Bell

    License Number: 01336646

    Prudential California Realty

    PHONE: (858) 344-9486

    http://911shortsales.com/

    ~ Your San Diego County Short Sale Specialist ~

  • South Metro Denver, CO Short Sale Specialist

    Posted Under: Home Selling in Denver, Foreclosure in Denver, Credit Score in Denver  |  September 30, 2013 8:30 AM  |  1,036 views  |  No comments

    South Metro Denver, CO Short Sale Specialist

    Short Sale Specialist in South Metro Denver

    Short Sale Specialist Realtor in South Metro Denver

    What is a real estate short sale in South Metro Denver?
    A quick sale in real estate, also commonly called a short sale, happens when a lender is willing to accept a lower payoff on a loan than what is currently owed due to the borrowers inability to continue making payments.

    What does it take to qualify for a South Metro Denver Short sale?
    While lenders seem to be easier to work with lately regarding qualifications, there are usually three borrower qualifications that most lenders require for a South Metro Denver short sale.

    1. Negative Equity - The proceeds from the sale of the property, after all closing costs are paid, are less than the amount currently owed on the property,
    2. Financial Insolvency - Financial insolvency means that the borrower has no other assets that could cover the deficiency (the difference between what is owed on the property and the proceeds from the sale)
    3. Financial hardship - Financial hardships that are acceptable do vary some from lender to lender, but the most common ones are; divorce or legal separation, loss of employment or reduction in income, job transfer or relocation, incarceration, medical emergencies or major medical expenses, death of a family member, vacant rental properties, damaged property, just to name a few. Most lenders believe that a short sale is not for home owners who simply want to sell, but for those who have to sell.

    Is it possible for me to get money back for completing a short sale?
    Until recent times, it was almost unheard of for a home owner to get money back in a short sale. Things have changed for the better. The HAFA program, backed by the US Government, allows homeowners $3,000 to use towards relocation expenses. In addition, some lenders will offer generous incentives of their own in addition to money offered through the HAFA program. We have seen home owners get as much as $35,000 back to complete a short sale.

    Who will pay the South Metro Denver short sale Realtors© commission?
    In a short sale it is customary for a lender to cover all fees associated with the sale of the property, including your South Metro Denver short sale specialist as well. In almost all cases, a home owner in hardship will pay no out of pocket expense to complete a short sale transaction.

    How Can a South Metro Denver short sale specialist help me? 
    As a South Metro Denvershort sale specialist, I have helped many home owners who are in a Short Sale Realtordifficult financial season get a fresh start with a short sale. Short sales are not part of our "basic training" as real estate agents, and are something that should only be left to those of us who are especially qualified and experienced. Experience is everything when it comes. I'll not only market your home in the traditional manor, but will guide you through this transition while simultaneously processing the short sale with your lender. Visit my website for more information on the short sale process.

                                                                       Sheila Russell

    License Number: 1319318

    Cherry Creek Properties Llc

    PHONE: 303-748-4190

    foreclosurehelp4you.net

    ~ Your South Metro Denver Short Sale Specialist ~

  • How to Recover from a Short Sale

    Posted Under: Home Selling, Foreclosure, Credit Score  |  February 29, 2012 9:19 AM  |  3,728 views  |  1 comment

     

    Recovering From a Short Sale:
    Questions on How To Get Back On Your Feet

     

    It is understandable that some homeowners may not feel positive about recovering from a short sale.  This is primarily based on the combination of depression and frustration that they are currently feeling.  After all, they did just lose a home and with not very clear prospects on how the future will look for them.  At this point, homeowners need to keep a positive perspective in order to allow themselves to see clearly what is up ahead on the road that can help them get back on their feet.

     

    For most part, homeowners will not find it difficult to deal with the short sale as long as they know how to go about getting on the road to recovery.  There are a number of adjustments that need to be done and goals should be set to ensure that the type of financial condition they are currently having will never be repeated.  Considering the huge number of homeowners facing financial distress, concerns on how to recover from a short sale should be given ample focus.

     

    1. How soon can you become a homeowner again?

    Generally speaking, homeowners who are dealing with past credit issues because of financial constraints should be able to have a new home in about three years on the average.  This would of course vary depending on the type of loan they want to avail as well as the lender they are considering.  It is important to note that every lender has its own underwriting guidelines on how and when to accept.  For government insured loans, 620 FICO is usually the starting point.

     

    When recovering from a short sale, the clock does not actually start from the moment it is transferred to a new owner.  For some homeowners who have miraculously kept up with payments, despite being in an upside-down condition, theoretically, they can apply for a new mortgage right after the short sale transaction has been concluded.  A lot of these by part would be theoretical because it is hard to assume how underwriters will evaluate the individual conditions of homeowners including their risk factors.

     

    It is also important to consider the mood of the lender bank when contemplating how fast you can get a new home for your family.  Basically, the three years timeframe is a good measuring stick.  For more conservative banks, it can go up as high as seven years.

     

    1. What are the credit effects of short sales?

    Waiting endlessly for a listed property to be sold in such a volatile market can be nerve wrecking for any homeowner.  When considering the credit implications of short sale, it is vital to note that 120 days of non-payment when in short sale mode will have an impact on your FICO score equivalent to a foreclosure.  With this in mind, you need to consider that short sale transactions on the average take anywhere from 6 to 13 months.

     

    This means that the longer the short sale transaction takes to close, the worse your credit score becomes.  This is an important thing to consider when contemplating on recovering from a short sale.  More recent negative impacts on your credit score have more substantial effects compared to older ones.  In essence, your credit score will only begin the recovery process once the late payments cease and the property is sold.

     

    The role of the experienced short sale specialist becomes vital at this point because of the negotiation for the short fall owed to the bank.  Some banks may require promissory notes or seller participation.  In case debt balance is forgiven, you must be aware that the IRS considers this as an income, which means that it is taxable.  You need an experienced real estate agent to give you the best advice to be able to recover faster.

     

    1. How to deal with Fannie Mae guidelines?

    In a short sale transaction, Fannie Mae normally allows for the funding of a home purchase within three years.  This is of course based on a couple of hardship factors.  In case you filed for bankruptcy, the waiting time may be extended by at least a year or probably more.  At the same time, you should expect to receive higher interest rates and a more stringent evaluation of your loan application.

     

    When you consider recovering from a short sale, you must be aware that securing a conventional loan may be challenging.  This waiting time is similar to that of a deed-in-lieu with the main difference being that with short sale transactions, you remain the holder of the title until a new buyer comes along.  Therefore, the moment you hand over the keys to the new owner, you are on your way to recovery.

     

    1. What are the effects of FHA, VA, and USDA guidelines?

    With government lenders, recovering from a short sale normally takes a shorter time with the homeowner having the possibility of purchasing a new home within 2 to 3 years.  This is of course provided that there is a solid credit recovery story to back it up.  In some instances the waiting period can even be shortened based on some exceptions like disability for example.

     

    When it comes to individual banks, each has their own set of rules by which they can accept the terms of credit score, which inevitably affects the recovery time of the homeowner.    Basically, two years becomes a reasonable time to be in recovery provided that the factors go in your favor.  Some homeowners that benefit from shortened recovery periods may be offered Lease to Purchase Option.

     

    The possibility is based on the practice of some private sellers who are less concerned about the credit standing of the homeowner, but want to generate income from the lease until such time that the property can be fully purchased.  This recovery strategy can work both ways, which is why it is important to consult with a lawyer before signing any contract.

     

    Starting to rebuild your credit as well as attempting to have a new home can be as easy or as difficult as you make it.  Essentially, the road to recovery begins with a strategy that you must follow from day one until you have made it back on your feet.  These questions can serve as your guide to recovering from a short sale.

    To find short sale help or to answer additional questions
    you may have contact a short sale specialist now! 1-877-737-4903

    Find a local Expert! CLICK HERE!!

    Questions & AnswersFREE Home Evaluation



    www.Short-Sale-Specialists.com

    1-877-737-4903

    Ask a local short sale specialist!


    Copyright 2011 Short Sale Specialist Network - First Coast Realty Associates
  • Will My Debt Be Forgiven in a Short Sale?

    Posted Under: Home Selling, Foreclosure, Credit Score  |  November 30, 2011 8:28 AM  |  1,450 views  |  1 comment

    Will I Be Forgiven of My Debt in a Short Sale?

    If you would like to avoid foreclosure on your home, you should consider short selling your property. A short sale refers to the process of a lender accepting a discount or a reduced price on a mortgage of a property.

    For instance, if you are facing a possible foreclosure on your home, a lender will look for potential buyers that are willing to purchase your property at a discounted rate. The discounted rate is already considered as the full payment of your loan.

    Why Lenders Accept a Short Sale on a Property

    You might be wondering why a lender is willing to accept a short sale on a property. There are many reasons as to why they do this. One of the main reasons behind this is that financial institutions such as banks prefer to keep their records straight and clean. Most banks also do not want excess inventory on their books. So in the event that they are provided with an opportunity to sell properties that will not result in major losses, they welcome a short sale transaction.

    Another reason as to why lenders are willing to accept a discounted rate on a mortgage is that a short sale offers them a higher income than if a property is auctioned off. There are numerous fees associated with a property that goes to an auction. So rather than lose more money on an auctioned property, they are willing to take a lower price beforehand.

    Short Sale Debt Forgiveness

    If you are considering short selling your property, then you might be facing the problem of a possible foreclosure. You might also be wondering if your debt will be forgiven in a short sale. These are valid questions that you should ask yourself before you consider short selling your home. There are certain situations where you may be forgiven of your debt in short selling your property. What you should do is  learn as much as you can about this subject in order for you to make the best decision.

    Here are some of the most important questions that you should ask about short sale debt forgiveness:

    When is a debt forgiven in a short sale?

    If you are worrying about paying for higher fees and taxes when you short sale your home, you should understand that there are some exceptions that can be made to forgive any debts that you have. Through these exemptions, you can avoid having to pay a large amount to IRS even after short selling your property in most cases.

    One situation where your debt may be forgiven in the event of a short sale is when you are considered as insolvent before the debt is discharged. The excluded amount from your income is generally the amount that covers the extent of your insolvency. However, any amount that is more than the extent of your insolvency would be reported and tax will already be included.

    Another situation where your debt may also be forgiven is if you have gone bankrupt. This type of exemption from income has no limit, as you can exclude any amount of debt discharged if you filed for bankruptcy. While the court will grant you with a discharge on any of your debts, you will be supervised by the bankruptcy court.

                                                   Short Sale Specialist Network

    What is the Mortgage Forgiveness Debt Relief Act?

    The Mortgage Forgiveness Debt Relief Act of 2007 is a provision that allows you to exclude income from the discharge of your debt on your principal residence. You can qualify for this relief if your debt is reduced through a restructuring of your mortgage or if your mortgage debt is forgiven because of a possible foreclosure. It is vital that you understand this option that you have if you are considering going for a short sale.

    The Mortgage Forgiveness Debt Relief Act of 2007 applies to debts that are forgiven in 2007 up to 2012. This exclusion may reach up to $2 million worth of debt forgiven, or $1 million if married filing is done separately. However, this provision does not apply if the debt discharged is because of any services given to the lender. This provision also does not apply to any reason that is not related to the decline in the property’s value or the owner’s financial status.

    If my debt is forgiven in a short sale, is it taxed?

    There are certain situations that a short sale is non-taxable, but there are also some situations where the IRS will not consider it as taxable. When you consider short selling your property, you can take advantage of this IRS tax law that is going to expire in the year 2012. While this does not have any bearing on most financial institutions, this may mean a significant amount of savings on your part.

    However, while you may depend on the Mortgage Forgiveness Debt Relief Act, you should also keep in mind the IRS may consider the forgiveness of your debt as income. Since they look at your debt forgiveness as income, this means that it is taxable. Apart from this, there are also some lenders who may accept a short sale that will pursue you for the difference between the amount that you owe and the amount that you paid. The best thing that you can do in this situation is to consult with a lawyer in order to determine whether your debt is considered non-taxable or not.

    However, it is always recommended you contact a Short Sale Specialist Realtor to handle your short sale for you. Although some Realtors claim to know all there is about short sales; one short sale hardly classifies as experienced. You need agents who are thoroughly experienced and have developed the perfect knowledge and skill to take on a short sale. Our Short Sale Specialists are those types of agents. After all, it’s what they specialize in! Contact us and let us make sure your short sale goes smooth and tidy!

    To find short sale help or to answer additional questions
    you may have contact us now! 1-877-737-4903

    Find a local Expert! CLICK HERE!!

    Questions & AnswersFREE Home Evaluation



    www.Short-Sale-Specialists.com

    877-737-4903

    Ask a local short sale specialist!

    Copyright 2011 Short Sale Specialist Network - First Coast Realty Associates


  • How does a Short Sale affect credit scores

    Posted Under: Foreclosure, How To..., Credit Score  |  November 16, 2011 10:00 AM  |  1,311 views  |  No comments

    How A Short Sale Can Affect Your Credit Score

     

    The real estate market recently saw a huge dip, as a consequence of the recession. This coupled with the recent economic downturn that cost millions of Americans their jobs and caused the rise of real estate foreclosure property listings. Consequently, many people would rather rent a home than worry themselves with mortgage payments month in and month out. But while real estate brokers and agents seem to enjoy making profits from various foreclosure deals, short sales are clearly on the rise because it is a better option rather than facing foreclosure.  But how do you short sale and what are its pros and cons as compared to foreclosure?

     

    Short-sale defined

     

    The short sale of a home is when a home is sold for a lesser amount than what it was originally worth or owed on the mortgage.  There are several ways that a homeowner can get out from under of a home, but a short sale may be the best solution in dire circumstances.  Being foreclosed on will definitely have a negative impact on your credit record.  Below is a list of just some of the fallout you can experience after a foreclosure:

     

    · Getting your property foreclosed means surrendering it completely to the bank;

    · You are given a limited amount of time to vacate your home, especially if you have been negligent on the time line;

    · A foreclosed record can last from 7 up to 10 years in a person’s credit record;

    · A foreclosed property record can generally affect the homeowner’s loan options, and lastly;

    · A foreclosed property record might be investigated by a prospective employer and can generally affect a homeowner’s chances of landing a job

     

    Though a short sale is generally preferred over foreclosure, it is important to note that proper knowledge is needed in order for a short-sale to be successful.  Also, the short sale of a home impacts an individual’s credit score, though not as much and as negatively as a foreclosure could.  While that may be the case, it is also important to know what the effect of a short sale has on a homeowner’s credit score also.

     

    Credit scores

     

    So what are credit scores and why should it matter to homeowners considering short sale?  Basically, there are three major credit organizations that collect information when it comes to credit borrowing, spending and payment: (1) Equifax, (2) Experian and (3) TransUnion.  The gathered information is then compiled into a person’s credit report and with the use of a formula provided by Fair Isaac Corporation (FICO), an individual’s credit score rating is determined.  Generally, credit scores matter because they affect how banks, lending institutions and other big companies interact with an individual:  the higher the individual’s credit rating, the easier it is for loans to be approves; a low credit score rating on the other hand leaves a negative mark on the record of the individual because of negligence or delinquency when it comes to making payments.

     

    Short-sale effects and why it is generally better for your credit score

     

    The main thing to remember on the onset is that credit implications are very different for those homeowners who choose to sell their homes, despite the fact that it will be sold at less than what’s owed on a short-sale as compared to those forced into surrendering their property due to delinquencies of payment on mortgages as in foreclosures.  But no matter what the cause, a short sale can still affect a homeowner’s credit score.  Below are just some of the examples and important points to consider:

     

    · The term “short-sale” never shows on credit reports – unlike the term “foreclosed property” or “foreclosed property owner”, the term “short-sale” never shows up on credit reports and records.  While there will still be some record of the short-sale reflecting on your credit record, it will most likely appear as a loss or a negative rating.  It is important to note that any form of negative credit rating, no matter the cause, is still considered bad, so while a short-sale may not show as expected, it may still leave an impact on your record.

     

    · Short sales can be settled – unlike foreclosure records which immediately cuts off  homeowner to any right to his or her property, a homeowner engaging in short-sale may still settle the owed amount to the lender.  In the case of settlement, the record in the credit reports is updated to show “settled”, which will have a more positive impact on your records.

     

    · You do not have to be delinquent to qualify for a short-sale – Before, lenders only consider allowing homeowners to short-sale their properties if they have been delinquent in their payments, but until recently this is no longer the case.  So, a homeowner can short-sell their property while still positive on payments, therefore avoiding any records that might brand him as “seriously delinquent” and negatively affect their credit record.

     

    Conclusion

     

    FICO has stated that an average score of 85 to 160 points will be subtracted from a credit score for a homeowner who has a foreclosed property or has engaged in short-sale of their property.  While the credit loss is the same, it is important to note that your credit score can recover even after a short sale with by making “on time” payments on all of your other bills in the future.  Rebuilding a positive credit score after a short-sale can be very difficult, but it is indeed a better option than waiting for 7 years for your foreclosure record to be cleared from your credit report, just so you can get a loan or buy a new house.

     

    Before opt to let your bank or lender foreclosure on your home, do your research on a short sale versus a foreclosure because once you have done that, you are probably going to  want to explore the short sale option.  The process may be a bit rigorous but will be a much better option for your credit in the long run. Now that you are familiar with the perks of a short sale, I encourage you to contact one of our highly experienced Short Sale Specialists right away, our services are 100% FREE! Time is of the essense!

    For any further information about the short sale process
    feel free to contact us

    www.Short-Sale-Specialists.com

    877-737-4903

    Ask a local short sale specialist!

 
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