International Title & Escrow has a knowledgeable Short Sale Negotiation Team and is run by experienced attorneys. Attorneys directly handle all short sale negotiations.
A. A short is a sale of real estate in which the proceeds from selling the property will fall short of the balance of debts secured by mortgages and liens against the property. A short sale is often used as an alternative to foreclosure because it mitigates additional fees and costs to both the creditor and borrower. Both often result in a negative credit report against the property owner.
A. Generally speaking the answer is “Yes”. In Virginia, the District of Columbia, and Maryland, lenders have the right to pursue their borrower for the deficiency on the loan if the borrower defaults. These types of jurisdictions are called “recourse states.” However, most lenders decide not to go after short sale sellers personally for their deficiency.
A. According to IRS regulations, the short sale seller is responsible paying income taxes on this cancellation of debt if it is for more than six hundred dollars ($600). In 2007 the United States Congress passed the Mortgage Debt Relief Act that will generally allow to exclude from income debt that was forgiven on their principal residence.
A. From the time all the required documents are submitted to the lender, approval can take anywhere from 30 days to 1 year. The approval process is highly dependent on what lender is servicing the mortgage, whether there are one or two lenders with whom negotiations must be made, and whether or not there is an investor that must also approve the transaction.
Furthermore, all parties must be aware that many properties trying to be sold a short sale also have pending foreclosures and there is no guarantee that the lender will stop the foreclosure while the short sale is being processed. As the scheduled foreclosure date approaches we will request the foreclosure be re-scheduled or be postponed indefinitely.
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