Here you’ll find some of the most common questions asked about short sales. Remember, if you don’t find an answer to your question below, you can always contact us for a free consultation here.
Frequently Asked Questions
A short sale means that you have received permission from your mortgage company to sell your home for less than the amount outstanding on your home loan. Thus, the fair market price falls “short” of the amount currently owed.
If you need to sell your home, owe more on the loan than the home is worth and have financial/personal hardships that are preventing your from making your payments, you may qualify for a short sale. Call our office to discuss your options at 425-374-3947.
Short sales are time consuming and can be a lengthy process depending on the lender’s, seller’s and agent’s reaction times. Many lenders have to work with several departments to get a short sale approved. Due to the lengthy process, it is critical to have a short sale firm representing you that is familiar with the process & requirements to ensure that everything moves quickly and efficiently.
Unfortunately, a short sale is only a request and not a guarantee. Therefore, it is the lender’s decision to issue an approval on a short sale (and their investor guidelines).
No. Short sales are very complex transactions with important implications for borrowers. Due to this complexity, a short sale should only be handled by a real estate broker who has substantial experience with short sale processes.
When a lender cancels or forgives a debt, the said debt may then be considered taxable income under tax laws. The Mortgage Forgiveness Debt Relief Act of 2007 provides debt forgiveness of up to $2 million and is not considered taxable income if:
• The house has been used as your principal place of residence for at least 2 of the previous 5 years.
• The debt has been used to buy, build, or make substantial improvements to the home.
NOTE: Home equity loans that were not used to buy, build or improve the home do not qualify for this exclusion.