I will like to do a short sale on my property in California, but I have an Equity loan lien on it , what will

Asked by Patrica R., Dallas, TX Sun Sep 28, 2008

happen with that loan if is not enough money to pay after the sell

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Scott Godzyk, Agent, Manchester, NH
Mon Sep 29, 2008
If you have a n equity line a short sale may not work in your situation. the problem being in a foreclosure the 1st mortgage will wipe out the 2nd motgage/equity line so the first mortgage will not take any less if they see you giving any money to the second mortgage. you need to be in a positionb where the first mortgage is getting paid and then a short sale is with only the quity line. if you are not in a position to do this, then you should try and negotiate with the equity line first and see if you can pay them off teh hud as again the 1st nmortgagee want take any less if they see anyone else getting paid. find a broker who is experienced in short sales to assist you. good luck
Web Reference:  http://www.ScottSellsNH.com
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Keith Sorem, Agent, Glendale, CA
Mon Sep 29, 2008
You should talk with your CPA regarding the tax consequences. In order for a short sale to proceed you need the approval of all parties, including the home equity loan lender. Depending upon your qualifications for a short sale, meaning proving hardship, they are going to want to know what happened to the cash and how you plan on repaying them.

This is a common problem with people that get in over their heads and is best answered by your CPA because it is likely that if the HELOC lender DOES agree to a short sale, they will issue you a promissory note for the balance or issue you a 1099 for the foregiveness, both may have serious tax consequences.

We have a very good and experienced Realtor that does short sales in Dallas and I would be happy to refer you so you can find out all of your options.
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Gail Gladsto…, Agent, 11743, NY
Mon Sep 29, 2008
That is what a short sale is all about, no matter how many loans are against the property. Contact me off line at Gail@Gailgladstone.com and I will refer you to a short sale specialist who works side by side with your local Realtor to make sure your transaction is handled properly.
Web Reference:  http://GailGladstone.com
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