Did you know sellers can get up to $35,000 cash incentives from the bank for doing a short sale?
There’s still so much information about short sales. Let’s get the biggest facts straight. Here’s why short sales should be considered as a serious option for sellers with no equity and faced with a financial hardship.
- Sellers can get cash incentives. Up to $35,000 with some banks. But the great majority of banks, through the HAFA program will give up to $3,000 to sellers to motivate them to complete a short sale.
- There is a good chance to walk away from all liabilities. In the vast majority of owner-occupied or primary residence short sales where the seller has a legitimate financial hardship, we are finding the banks are releasing the sellers from all liabilities and deficiencies after closing.
- No tax consequence, in most cases. Although the Mortgage Debt Forgiveness Act of 2007 is set to expire Dec 31, 2013, it’s likely it will get renewed again. This act provides that for most cases, a short sale forgiving up to $2 Million in debt will not result in a tax consequence if the seller meets the requirements.
- More favorable credit outcome. This one is tricky and depends on the sellers credit profile, but generally short sales appear better on a credit report than foreclosure, bankruptcy, or other alternatives. Also homeowners who sell short sale are eligible to repurchase with institutional financing much sooner than after a BK or Foreclosure, which means they are more likely to buy from you sooner after you help them with the short sale.
- Banks getting easier, and harder at the same time. The good news is that banks are more organized than ever. The bad news is that this works against you if you don’t have extensive professional experience navigating the short sale jungle. Now banks are more likely to cancel a short sale after 3 months of not telling you just for having one form filled out incorrectly. The flip side is, if you have the right team guiding you through the process, and complete all the paperwork correctly, many lenders can render decisions faster.
Let’s not forget that short sales are still a largely untapped market, due to the great misinformation circulating in the real estate community. Earning commissions from short sales has become a very lucrative pursuit for many agents who are able to arm themselves with the right knowledge and the right team to actually handle the details of the short sale for them.
[author] [author_image timthumb=’on’]http://rutenbergblog.com/wp-content/uploads/2013/11/Paul.jpg[/author_image] [author_info]By: Paul Yevzikov, Consultant for Charles Rutenberg Short Sale Division.[/author_info] [/author]
For more information on Charles Rutenberg’s Short Sale Division visit: http://rutenbergshortsales.net/members/
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