Short Sales: How they affect sellers.
Distressed Properties, Foreclosures, Northern California Real Estate, Redding Real Estate, Shasta County Real Estate, Short Sale, Sites & Sounds of Redding, Uncategorized
December 11th, 2009
T
he good, the bad, and the ugly about short sales and the seller in California.
The reason that most home owners attempt to do a short sale on their property is to avoid the stigma of a foreclosure. Home owners want to salvage their credit and they think that a short sale is the answer. There is a lot of different advice and opinions floating around about the best thing to do if you are facing foreclosure. Just Google foreclosure or short sale and see what you get! Before you decide if a short sale is for you or not, you need to look at the good, the bad, and the ugly.
‘The Good’…In a perfect world a homeowner facing foreclosure would contact a reputable Realtor who knows how to correctly handle a short sale. That Realtor would then explain the pros and cons of doing a short sale to the homeowner. The property would be PRICED CORRECTLY, marketed, and sold for the best price possible in the current market. The short sale would then be negotiated in a reasonable amount of time, say 30 days, by said competent Realtor. The homeowners lender would agree to the short sale terms, because everyone involved can see that this is the best course possible given the current housing market and economy in general. The lender would agree to release the homeowner of all liability concerning the deed of trust on the house and report the loan as, paid in full without benefit of deficiency judgment, to the credit bureaus. The homeowner wouldn’t be liable for any taxes on the forgiven debt because the loan is an original purchase loan. The homeowner gets to walk away from their impending foreclosure with minimal damage to their credit and start fresh. Ah…the perfect world…the perfect scenario…
The above situation is to everyone’s benefit, the seller, the buyer, the lender, the community, and I believe, our economy. Unfortunately ‘The Good’ it isn’t the way it has been working out, but we are seeing glimmers of hope for 2010. The Treasury Department has just come out with some new guidelines for Short Sales that I will address in an upcoming blog.
My next article will be on ’The Bad’ & ‘The Ugly’ possibilities with short sales and the seller. Subscribe to my RSS feed if you want to get the second part of the article as soon as I publish it on my blog. Don’t hesitate to contact me with any questions you may have about short sales or real estate in general.
Thanks for stopping by…
Lauri Gibson
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