What is A Short Sale?

Rodney Elkins is a certified short sale & foreclosure specialist.  If you have any questions concerning the possibility of buying or selling your home as a short sale Contact Rodney Elkins for a consultation!

Considering a  SHORT SALE? Make an Informed Decision.

*You may have other options, including but not limited to: Forbearance, Loan Modification, or a Deed in Lieu of Foreclosure.

The upside of a Short Sale
·         Avoid Foreclosure (you may want to Consult your Attorney)
·         Being proactive will give you some control over the process. 
·         Minimizing damage to your credit score. You’ll be eligible to purchase another house faster than if you entered foreclosure..
·         The lender may forgive deficiency.
·         You are spared the lengthy and traumatic foreclosure proceedings.
·         Your credit score will usually recover more quickly than a foreclosure
·         You can re-qualify for a new mortgage loan more quickly than a foreclosure
·         You are more likely to escape bankruptcy.
·         If you are not able to pay the mortgage premium, or work with the lender on getting a lower monthly payment, a short sale may be  the best case scenario…even though it means losing your home and investment.

The downside of a Short Sale

There is still temporary damage to your credit – When a Seller has a Short Sale on their home, it is still recorded on your credit report, but will not have the same impact as a foreclosure.
Tax Consequences – there may be tax consequences if the bank forgives the debt and will issue a 1099 for the amount of debt forgiven.  The IRS treats the forgiven debt as a taxable income. Bank may file a deficiency for the difference between the offer and amount owed.  Contact your Accountant.
 It is a long process there is nothing "short" about a Short Sale.
If your home has liens, 2nd mortgages, or a home equity line of credit, each lender must give approval.
The lender may require you to sign a promissory note for the debt forgiveness in order to approve the short sale.
The lender may pursue a repayment of the debt forgiven after the short sale is completed. You may want to Consult your Attorney
You could be taxed on the debt forgiveness if the property sells for more than 2 million or is not your primary residence.  Consult a tax professional.