Know your Options before you Begin your Short Sale
- Even though home prices have appreciated here in California there are still some short sales and foreclosures.
- A short sale is just one of your options and it may not always be in your interest to go straight for the short sale.
- You might consider attempting to keep your home via a loan modification or a short payoff of your second loan or a hybrid strategy.
- We don’t do bankruptcy but we will certainly discuss the pros and cons of a bankruptcy with you.
- Short Sales almost always require an owner to cease paying on at least 1 or his or her loans
- Not all short sales succeed. If there are 2 loans a homeowner may still owe the junior lender for the entire loan if the junior loan is a sold out junior loan.
- The tax consequences for short sales, foreclosures and other loan workouts are somewhat confused right now. Debt relief laws may be expiring and the IRS has made a bit of a mess with their guidance.
- If you do have non recourse loans an attorney can help you leverage those loans in your negotiations.
- If you have two loans you may wish to work out a deal with your junior lender before you start the short sale process with the senior lender. Or vice versa.
- Sometime timing is everything. We can advise you on your best sequencing or how to achieve the timing you desire… in other words we can help you keep the home was long as you can while you get your finances in order. (perhaps)
If you do decide to do a Short Sale
- We can use the law to gain leverage during your negotiations
- We can help you keep you sell the home in as discrete a manner as possible if that is what you wish.
- We can bring you arms length buyers or we can just work with you and let others Realtors represent the buyers
- If there are things you do not wish to disclose to the lender, I can tell you from experience we can leverage the law to get some banks to agree to not have you fill out a full short sale package. Having attorney represent you during short sale negotiations can be particularly important in divorce situations or when one spouse has substantial assets but is not on the loans.
Taxes and Short Sales
The law is in flux right now and the IRS and Franchise tax board seem to have given inconsistent. See our post on short sales and taxation. No responsible Realtor is going to be giving you tax advice and they certainly will not agree to write legal letters to the IRS to help you out. If you work with us and you are have and issue with the IRS or a lender after doing a short sale. We will help you. Not only will supply you with a legal letter explaining my interpretation of the laws as an experienced California attorney. I will also help you negotiate with the IRS if need be. I should note that I am not agreeing to litigate or appear with your in court or at the IRS… but I will make calls and write letters as long as I deem it fruitful.
Contact me before you stop paying your loans or list with a Realtor for a free consult about all your options and the best sequencing of your strategies.