My job contract in FL expired and i found a permanent job in Missouri. What can we do with the condo? Its underwater

Asked by homeown, 33617 Tue Nov 27, 2012

My job contract in FL expired and i found a permanent job in Missouri. What can we do with the condo? Its underwater. We bought this condo in Dec 2009 on FHA mortgage. The current loan amount is 86,000 and value of condo is $56,000 (as shown on different real estate web site). I would like to put it on short sale. Hope I can use relocation for employment as a cause of financial hardship. We put this condo on rent before we left FL in Aug 2011. Now the tenant is about to move out and I don't have resources or time to put it on rent again. It was our primary residence as long as we lived in FL but then it became an investment property since we rented it out. How this will affect my chances of getting approval for a short-sale? I would also like the loss from short sale to be forgiven.

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Andrew Schmitt’s answer
Andrew Schmi…, Agent, Riverview, FL
Wed Nov 28, 2012

I would not put much weight into the real estate valuation websites. They tent to be very inaccurate. I would contact a local Realtor to first get a market analysis of your property. The market has recently bounced back because the housing inventory is extremely low and there are a ton of buyers.

You appear to have a financial hardship because of your employment relocation. It should not affect you being approved for a short sale. You could potentially have tax consequences and your lender may still come after you with a deficiency judgement. Also your credit will be wrecked. I wouldn't be so quick to jump into a short sale. You may have other and better options.

Please feel free to call or email me with any questions you may have.

Andrew Schmitt
Yellowfin Realty
Sales Associate / Property Manager
Cell: 813-857-1543
1 vote
Tom Lifrieri, Agent, tampa, FL
Wed Nov 28, 2012
Lots of good answers. My advice is to check with your lender first. See what they have to offer. You may be able to do a modification and reduce your payment enough to keep and rent the unit the market comes back. It is eventually going to come back. I am a very experienced short sale agent and will be happy to assist you if that is your best course of action. Best wishes with your lender.
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1 vote
Robert Krop, Agent, Frederick, MD
Wed May 21, 2014
You should contact a local realtor who specializes in short sales to help you determine whether a short sale will work in your situation. Most bank would agree that your job re-locating you is a good reason.
0 votes
Iwona, Home Seller, Tampa, FL
Thu Nov 29, 2012
I would like to sell it. We bought our house on May and my husband get the job in Seattle We decide to try sell it. In 12 days we were already under the contract.
May work
0 votes
Janeth Rector, Agent, Tampa, FL
Wed Nov 28, 2012
Great advice below. For sure you have to double check to make sure it is under water. If so, I believe since it sounds you have a hardship since you no longer are employed or live in the area, a short sale might be the best option. However, I recommend speaking with an agent before talking to your bank. I have worked with many sellers that are stirred away from a short sale by the bank when they could have actually gotten one approved. Another options is to do a Loan Modification to reduce your mortgage payment and rent the place again. Good luck in Missouri. If you would like more information please go to this website:

Janeth Rector
Keller Williams Realty
(813) 679-5307
0 votes
Erek Kirsten, Agent, Tampa, FL
Wed Nov 28, 2012
Sounds like you may have a decent investment property there. I would seriously consider partnering with someone who has the resources to allow you to keep the investment. Why sell if you dont have to. We regularly partner with people in your situation. Contact me if you would like to discuss.
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0 votes
Lynn Brock, Agent, Sarasota, FL
Wed Nov 28, 2012
homeown 33617, it is a tough situation when opportunities have opened up elsewhere and you are held up on a short lease from moving forward due to loose ends that you left behind.

as mentioned, get a strategy. if the tenant is moving out to help cover costs while you are thinking, find a property manager to oversee the transition from one tenant to another. try and secure another tenant, on a month to month basis or with clear terms in the lease that the property will be sold, the tenant will cooperate with showing requests and that it will be sold as a short sale. this will take some financial pressure off of you.

next, gather as much information as you can regarding a short sale and your particular situation. contact your lender and ask for help. if none forthcoming, you have received a number of excellent suggestions from agents responding to your question in this forum. pick one of them.

check with your accountant. true, that at the end of 2012 the debt forgiveness program expires. there is so much negotiation in washington and the desire to encourage economic growth that the program maybe presented as a bargaining chip to be extended. the national association of realtors is working towards this goal.

hopefully, you will be able to sit down, sketch out your options and figure out a plan.

Best regards,

Lynn Brock
Brock Realty Inc.

If you'd like to search the MLS like an agent in real time, you can visit our website and sign up for a free Listing Book account. You will be able to change the search criteria to suit yourself and received morning reports regarding new listings, price changes and recent pendings.
0 votes
Jenn Cook, Agent, Tampa, FL
Wed Nov 28, 2012
I just closed a short sale in your same situation. It was a rental property and the bank was BOA. They not only waived the deficiency, but also gave my client $3000 for relocation costs. I have a 99% closing ratio on the short sales that I negotiate and would be happy to discuss more details with you. Feel free to contact me anytime. Thanks and I look forward to hearing from you soon.

Jenn Cook
Bahia Realty Group
0 votes
Alma Kee, Agent, Tampa, FL
Wed Nov 28, 2012
The biggest issue I see is that you converted your "primary residence" into an investment property when you decided to rent it out. If the lender allows you to do a short sale and forgives you the loss they will send a form 1099 to the IRS and you cannot get an exemption on an investment property. I'm not a CPA or tax expert so you may want to verify this with a qualified CPA or Tax Attorney before attempting a short sale. You may have other options if you can claim "insolvency" or other loopholes.

You may need to bite the bullet and hire a local Realtor to manage your rental for you--unless you're okay with paying the extra "ordinary income" tax (not the lower capital gains rate like smart taxpayers, ie Romney) on the $40k you may be forgiven.

Hope this helps.

If your CPA/Tax adviser says it's okay to proceed with a Short Sale just be careful who you list it with because some short sale agents will charge the buyer an extra $3k "'negotiation" fee or offer less commission to the Buyer's Realtor so it will take longer to sell and could risk foreclosure. In Florida if you get foreclosed upon the lender may get a judgment and go after you (including attaching your wages and auctioning off your vehicles, etc.) so you need to sell it quickly and have an agent working towards your best interests and not their own!

All the best,
Alma Rose Kee PA
Future Home Realty
0 votes
Robert Adams, Agent, Tampa, FL
Wed Nov 28, 2012
As a footnote to my answer, there is a possibility that the unit may qualify for a capital loss: basically the equation would be fair market value of the unit on the date of conversion to investment less the depreciation plus the selling expenses is your basis: the difference between that and the sales price may be eligible for capital gains (loss) this over with your tax guru...
0 votes
Robert Adams, Agent, Tampa, FL
Wed Nov 28, 2012
It sounds like there are two questions: is a short sale possible, and can the tax consequences be forgiven on the canceled debt.

For the shortsale, I've included a link to the FHA site: basically, start by talking to your lender before talking with anyone else. Once your lender has given you some guidance, there will be some items you will need to get prepared. The short sale negotiator I use has a list.In general it includes two years of tax documents, bank information, employment and pay information and such. Most importantly, there is a personal statement from you explaining why the bank should consider that there is a hardship, what that hardship is, and what you have done to stave off the bank's eventual loss.

While it seems like a lot, once things are together, that aspect is complete. Based on the bank's guidance, they may recommend bringing a realtor on, and there may be some requirements for the listing. The Realtor will ensure the listing has the disclosures to potential buyers about the short sale. Some people hire attorneys to represent their interests before the bank and to facilitate a transaction, others either hire a negotiator or use a realtor who has a negotiator available for the sale: in some cases this can be done without additional direct expense to the transaction, so shopping around is wise.

There is some legislation that removes from taxable income the cancellation of debt of the primary residence of a tax payer. Naturally, there are rules to follow and exceptions to those rules which may allow for the exclusion. The legislation I speak of is set to expire at the end of 2012: unless it extends beyond, this provision of the tax code is a mote point. That leaves you with the potential strategy of claiming insolvency when faced with the tax consequences. For this, I recommend reviewing all the information with either a CPA, an Enrolled Agent (allows representation before the IRS), or a lawyer familiar with tax and real estate issues. I recommend that this be your starting point before even contacting your bank: get the right advice from an attorney and they can guide all aspects: once again, shopping for the right one is important.

Here is the link to the FHA site:…

Feel free to contact me on this to begin the process.
0 votes
Antonio Vega…, Agent, Saint Cloud, FL
Wed Nov 28, 2012
As of now, unless extended by congress, loss forgiveness ends on 12/31/12. From your description of the move due to job transfer the property should qualify for hardship. It all comes down to finding an agent from your zipcode that is experienced in SSales and getting the process started.
0 votes
Tom Scaglione…, , Tampa, FL
Wed Nov 28, 2012
Your best bet is to try and short sell the property. I would need more information to advise you better than that. First need to know how many mortgages there are on the property, Second need to have an address to do a market analysis of the true value of the property. You can go to for some additional information on doing a short sale as well as information on me.
Tom Scaglione, ePRO, SFR, REALTOR(r)
Future Home Realty, REALTORS(r)
Cell: (813) 310-8200 - Fax: (813) 909-2915
~ Tampa Bank Owned Team ~
Certified Bank Owned Sales Specialist
Certified Short Sale Specialist
0 votes
Stephen Gold, Agent, Tampa, FL
Wed Nov 28, 2012
It really depends on your lender. Give me a call to strategize your out and discuss 8134203394 steve
0 votes
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