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Short Sale And 1099 All Locations : Nationwide Real Estate Advice

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Showing results for Short Sale And 1099 [Clear search]
Wed Aug 10, 2016
Skeeter Wilson answered:
I personally don't know of anyone who would do that. I know I don't
0 votes 59 answers Share Flag
Mon Mar 13, 2017
Nick Rafello answered:
Since 2008, it really doesn't matter what year it is. And now, I take the 5th.

Nick Rafello
Senior Vice President
Associate Broker
The Corcoran Group
0 votes 87 answers Share Flag
Mon May 9, 2016
Daniel Harms answered:

I have a lender who will Work with you with a credit score of 580.

Daniel Harms
Tarbell, Realtors
0 votes 4 answers Share Flag
Sun Dec 2, 2012
Teahmeah answered:
The best one to answer that question for you is the lender unless you going to another lender to do a re-modification. Ask your broker, check your contract you signed to see if you can cancel out after a certain number of days. ... more
0 votes 15 answers Share Flag
Thu Apr 27, 2017
Carl Henker answered:
The program you are looking for is gone, stated income is a thing of the past. Documentation of the ability to repay the loan will be required for any conventional program. Perhalps with 40% to 50% down you may find a hard money lender that cold provide a loan. However most are no longer providing owner occupied loans. Sit down with an experience loan officer and determine what you may qualify for. ... more
0 votes 31 answers Share Flag
Thu May 22, 2014
Christopher Pagli answered:
Hi, it depends on the reason for your shortsale, figure about 2-3 years. It could be sooner depending on your reason and the type of loan you apply for.

0 votes 20 answers Share Flag
Mon Mar 5, 2012
Tammy Hayes answered:
Here is information I wrote previously in a blog about buying a short sale.

Buying a short sale is not like buying a property in a traditional way. A short sale may have some risk but it also can be very rewarding. When you are searching for a short sale you will want to make sure you are prepared. Here are some things you will need to consider.

First of all, you need to make sure that you have enough time. It takes anywhere from 30 days to 6 months or even more to get an answer on a short sale. It really depends on many factors. It requires a proof of funds letter if paying cash or a pre-approval letter from a lender if obtaining a mortgage. The seller must approve the purchase offer before it gets submitted to the bank. The bank may come back with a counteroffer or reject your offer completely. In some instances you may not even hear back from the bank at all.

Short sales take a long time because the bank has to review it and they are back logged with many short sales and don't have enough coverage to complete them in a timely manner. The bank typically is willing to work with the seller and buyer on short sales to help avoid foreclosure. The bank can ask the buyer to pay some of the liens or HOA fees. Some lenders will only pay up to a certain dollar amount and ask the buyer to pay the remainder or there is no deal.

One of the benefits of buying a short sale is that the bank is typically willing to accept less money for the property because of the time and risk involved. So you generally are getting the home at below market value.

If you have the time to wait, a short sale is a good way to go. One thing to be sure to ask when purchasing a short sale is, "who is handling it?" Is the Realtor an experienced short sale expert? Or is the listing agent using a Short Sale company that strictly focuses on short sales? By having someone with knowledge and expertise in short sales, it will make the process go much smoother and faster.

Tammy Hayes, Realtor, Green Lion Realty, Port Charlotte, FL
... more
0 votes 5 answers Share Flag
Mon Aug 29, 2016
Alistair Barrett-Powell answered:

I hope this helps! Let me know if you have more questions :) - 305.815.0880


The Basics of a Short Sale

Banks grant short sales for 2 reasons: the seller has a hardship, and the seller owes more on the mortgage than the home is worth.

A few examples of a hardship are:

* Unemployment / reduced income
* Divorce
* Medical emergency
* Job transfer out of town
* Bankruptcy
* Death

The seller will need to prepare a financial package for submission to the short sale bank. Each bank has its own guidelines but -- with the exception of Wachovia, which is the best short sale bank in the world -- the basic procedure is similar from bank to bank.

The seller's short sale package will most likely consist of:
* Letter of authorization, which lets your agent speak to the bank.
* HUD-1 or preliminary net sheet
* Completed financial statement
* Seller's hardship letter
* 2 years of tax returns
* 2 years of W-2s
* Recent payroll stubs
* Last 2 months of bank statements
* Comparative market analysis or list of recent comparable sales

Writing the Short Sale Offer and Submitting to the Bank

Before a buyer writes a short sale offer, a buyer should ask his or her agent for a list of comparable sales. Banks are not in the business of giving away a home at rock-bottom pricing. The bank will want to receive somewhat close to market value. The short sale price may have little bearing on market value and may, in fact, be priced below the comparable sales to encourage multiple offers.

After the seller accepts the offer, the listing agent will send the following items to the bank:

* Listing agreement
* Executed purchase offer
* Buyer's preapproval letter and copy of earnest money check
* Seller's short sale package
* If the package is incomplete, the short sale process will be delayed. In this event, the bank might even shred the package.

The Short Sale Process at the Bank

Buyers may wait a very long time to get a response from the bank. It is imperative for the listing agent to regularly call the bank and keep careful notes of the short sale process. Buyers may get so tired of waiting for short sale approval that they may feel the need to threaten to cancel if they don't get an answer within a specified time period.

That type of attitude is self-defeating and will not speed up the short sale process. If buyers are the type with little patience, perhaps a short sale is not for them.

Following is a typical short sale process at the bank:

* Bank acknowledges receipt of the file. This can take 10 days to a month.
* A negotiator is assigned. This can take 30 to 60 days.
* A BPO is ordered. The bank probably will refuse to share the results of the BPO.
* A second negotiator may be assigned. This can take another 30 days.
* The file is sent for review or to the PSA. This can take 2 weeks to 30 days.
* The bank may then request that all parties sign an Arm's-Length Affidavit.
* The bank issues a short sale approval letter.

or.....The buyer cancels and the deal is dead.
... more
0 votes 9 answers Share Flag
Thu Feb 23, 2012
Ann Ryan answered:
Ouch. See link to IRS information below. It seems likely that you will get a 1099. If you've already listed the house, you should be asking your agent these questions!
0 votes 2 answers Share Flag
Fri Feb 24, 2012
Antonio Vega-Pacheco answered:
Because it being an income property you are not protected from a 1099 like a primary residence would. Contact a Certified Public Accountant, CPA, who would be able to tell you the best strategy to deal with the situation.

Tony Vega
Charles Rutenberg Realty
... more
0 votes 3 answers Share Flag
Sat Jun 2, 2012
Kevin Cloutier answered:
Not really. If their bank offers a program whereby the bank actually pays them not to trash the house, that's about the only way

0 votes 15 answers Share Flag
Fri Jan 9, 2015
Ann Ryan answered:
Pros- You won't have to sell when property values are relatively low.
- Your credit would take a hit if you short sell, this would prevent that.

Maybe - You may collect enough rent to cover your mortgage and expenses (clearly depends on your mortgage payment and expected rent).

Cons - You do run a risk that the renters will trash the place (low, if you screen correctly)
- Your tenants may drive you crazy.

If you contact me, I'd be happy to run 1) comps on selling your property in the current market, 2) rent prices in your neighborhood, and 3) average days on market before rental. You should plan on painting, or touching up the paint in the interiors to help make the property more marketable. Also, try to tone down any "style" choices, from overly pink little girl's rooms to faux finishes.
... more
0 votes 18 answers Share Flag
Mon Feb 20, 2012
Dawn Barrier answered:
I have blogged about this before and have put a link in below for you. It depends on when the short sale gets finalized and a few other details.

For the best advise consult with your tax attorney or tax advisor. ... more
0 votes 5 answers Share Flag
Wed Feb 8, 2012
Sara Mehrpouyan answered:
This is not meant as legal advice however, California has a newer law- SB 458. The law says that the lender cannot pursue the borrower for any deficiency (difference) if they approve a short sale of the property. This should include 1st, 2nd loans etc. Feel free to contact me, I also work in Ventura County. Good luck.

Sara Mehrpouyan, CDPE
Specializing in Short Sale & Foreclosure
Rodeo Realty
Direct: 818-903-2040
Dre License #01712757
... more
0 votes 7 answers Share Flag
Thu Feb 2, 2012
Steve Matthews answered:
Hello Emily,

Sorry to hear you lost your property here. Nevada is a recourse State. They bank has 6 months to pursue their interest in your lien. there is a bit of controversy over this issue, but it appears that banks can still pursue up 180 days after foreclosure. after 180 days, they have no recourse.

Best of luck, and thanks for reading.
... more
0 votes 6 answers Share Flag
Thu May 30, 2013
Alma Kee answered:
Try a credit union. You will not have to "fit" into the very specific criteria required by most lenders. try most credit unions will let anyone join so don't let that stop you from shopping credit unions for a mortgage.

You see, most banks and lenders will immediately sell off your mortgage and if you do not "fit" they cannot re-sell it.

Also, if you still can't get a credit union mortgage, you may be able to get a NACA mortgage, take a look:

Just make sure you DO NOT SIGN up online or your Realtor will have to pay a large fee to NACA...let your Realtor sign you up online!

All the best,
Alma Rose Kee PA
Future Home Realty
... more
0 votes 7 answers Share Flag
Sat Jun 9, 2012
Ana Barlow answered:
Hi Edtheia:

You can go to your bank for a mortgage or to a private mortgage broker. They will both have several types of loans available, but a mortgage broker can really fit the mortgage to your specific needs.

Addtionally - if you are a member of a credit union it is an excellent place to start.

Please let me know if you need more direction or mortgage broker recommendations, I will include my email address.

Ana Barlow
Coldwell Banker Preferred
... more
0 votes 20 answers Share Flag
Wed Jul 23, 2014
Robert D Hughes answered:
Deployedbride, Please only use Professional, reputable/knowledgeable individuals. Many scammers out there or agents who have no clue what they are doing. Best to google and find out what the laws are regarding short-sales in your State. Yes if current owners are foolish enough to sign what is called a deficiency judgement, The bank has the right to come after you later for the money they lost in that sale. All States are different, verify with Attorneys or free legal advice what ever is your situation. Only use agents experienced in short-sales!

The IRS also gets a 1099 form from the lender stating the short fall, which has tax implications, so discuss with a qualified Attorney/accountant.

Very sorry this is happening to you and many more through-out our country.
Best of luck to you,

Rob Hughes-Long and Foster-RE INC.
... more
0 votes 28 answers Share Flag
Wed May 22, 2013
Don Tepper answered:
Check with a Realtor first. If you've got equity in the property, you can sell it as-is.

Even if you don't have any equity, you can sell it as a short sale in as-is condition. It'll hurt your credit, but not as much as a foreclosure.

You might also explore a loan modification (not many get approved, though it's worth a try) or a deed in lieu of foreclosure.

Foreclosure itself should be your absolute last step. A good Realtor can advise you on other, better options.

Hope that helps.
... more
0 votes 10 answers Share Flag
Wed Jan 18, 2012
Ron Thomas answered:
When a Foreclosure occurs, the Bank wants to take Title to the property;
If there is an outstanding LIEN, there will be a "cloud" on the Title.
The Bank had to have done something about that; it will be more of a problem for the Bank that it will be for you. They will not be able to sell the house with that "cloud" on the Title.
You live in a state with Non-Recourse legislation; meaning that the Banks cannot come after you for the Deficiency.
So between the two things, you should be able to just sit tight and let things work themselves out.
Good luck and may God bless
... more
0 votes 7 answers Share Flag
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