Foreclosure in Indianapolis>Question Details

Hillbilly5, Home Seller in Kyana, IN

I want to keep my home, can someone help we are trying to short sale, but it is also in active forclosure!

Asked by Hillbilly5, Kyana, IN Fri Oct 22, 2010

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Short sales are just about seems like you can't get away from them. Many sellers, loan officers and Realtors say they know a lot about short sales, but don't know how the short sale process works or even why a short sale is a better alternative to a foreclosure.

A short sale will enable the seller to purchase a home about 2 years after a short sale completion while a foreclosure will make you wait 5 years. In addition, short sales are better for the lender and it will keep the house occupied, with water and electricity still on and also keep the lawn mowed. Plus the bank will lose less money through a short sale.

No Foreclosure - foreclosures can be a hard and stressful process for a family.

Being Proactive - facing a foreclosure head on will help give you some control over the process.

Start Newer, Faster - minimizing damage to your credit can help you and your family get back on your feet faster.

May not owe anything after the short sale - you can try asking the bank to cancel your debt altogether. It does happen, but not all the time. Primary residences are usually treated more favorably by the lenders.

There is still damage to your credit - when a short sale is done, it is still documented on your credit but won't have the same impact as a foreclosure for most creditors.

Tax Consequences - there may be tax consequences if the bank forgives the debit and will issue a 1099 to the IRS for the amount of debt forgiven.

Bank could demand payment for their loss - the bank doesn't have to forgive the debt. They are able to ask you to pay them back for the difference on the sale and what is owed, but you will need to agree to this.

There are no guarantees in a short sale - whether the bank will approve the sale or forgive your debt, but short sales offer a better alternative to minimize the downside of facing a foreclosure.

Disclaimer -There can be legal and tax consequences. You may want to consult with an attorney or tax specialist before attempting a short sale. A real estate agent cannot give you legal or tax advice.

DO YOU QUALIFY? - Can you answer Yes to all 4 Questions?

1. The Homes' Market Value Has Dropped. Hard comparable sales must substantiate that the home is worth less than the unpaid balance.

2. The mortgage is in or near default status.

3. The seller has fallen on hard times. The seller must submit a letter of hardship that explains why the seller cannot pay the difference due upon sale, including why the seller has or will stop making the payments.

4. The seller has no assets. The lender will want to see a financial statement and recent tax returns.


1. The lender will want to see your entire financial picture.

2. The bank may want you to sign a promissory note for the deficiency between the amount owed and the amount your home is sold for.

3. As the seller, you cannot receive any proceeds from the sale. None. Period. Your Realtor and title company may have to work for reduced fees.

4. The banks are overwhelmed with short sales and many times a decision can take up to 60 days or longer.

5. The property may be foreclosed on during the short sale process. Be sure to use an experienced short sale company who should be able to get the foreclosure postponed.

6. Do not expect to receive information on a regular basis, as there may be weeks that go by without news from your lender.

7. The bank will want to get a BPO (Broker Price Opinion) and/or an appraisal of your house.

8. Be patient. This is the best policy. Try to avoid being stressed out over something that you are not able to control.
0 votes Thank Flag Link Fri Oct 29, 2010
Hello. From your location Kyana, I'm guessing your are in my area. I'd be happy to help guide you in the right direction if you want to give me a call. I have short sale experience and am a Certified Distressed Property Expert. Thank you, Bart Medlock
Web Reference:
0 votes Thank Flag Link Fri Oct 29, 2010
If you want to keep your home you should not be asking for someone to try and help you with a short sale, short sale means you sell your home to someone for leas than what you owe the bank and that is considered a foreclosure just a less destructive form of foreclosure.

If you want to keep your home you need to call your bank NOW and ask for a loan modification, if that does not work file the appropriate papers with the court that is handling your case asking for mediation. Do not forget to cry when you go before the judge, well maybe not that extreme, but you need to show the judge you are serious about keeping your home and that you are a victim of the current real estate and mortgage market meltdown.

Good Luck
Bob Patrick
Buy a home after foreclosure expert
0 votes Thank Flag Link Fri Oct 22, 2010
If you want to keep your home, you may want to check out this website.
0 votes Thank Flag Link Fri Oct 22, 2010
I have a short sale listing in Indianapolis right now and am familiar with the process and speaking with the short sale specialist on the bank's side on your behalf. I am unclear from the question how far along you may be. I may be able to help you if it has not gone too far into the process.

Best of luck,
Kristina Moore
0 votes Thank Flag Link Fri Oct 22, 2010
Dear HIllbilly, Make sure you keep in contact once a week with the Banks Negoiater very important. Often times you'll get the run around. If A Realtor is handling it make sure they are familar with short sales.
We can't say for your state but in N.J we would make sure the courts are aware of pending short sales, they will usually give you extra time to close the deal. Please check with your state to see if you can also delay the sale until you have closed on your short sale.

All the Very Best
Dave & Lisa
Web Reference:
0 votes Thank Flag Link Fri Oct 22, 2010

Sorry to hear about your situation.

Please go to the hud website for Foreclosure tips :…

Hope this helps.

0 votes Thank Flag Link Fri Oct 22, 2010
take a look at for additional information. I wasn't clear on whether it's listed as a short sell or exactly what you are trying to do.
0 votes Thank Flag Link Fri Oct 22, 2010
I may be able to help. Call me 317-259-7286. If the home is near Indianapolis.

0 votes Thank Flag Link Fri Oct 22, 2010
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