All About A
Short Sale Of A Home

A short sale of a home is a technique that real estate investors and agents use to help a homeowner prevent foreclosure. For a homeowner behind on payments and with little or no equity to sell, the best option is a mortgage short.

An investor or agent will contact a bank in an effort to convince the bank to accept less money than what is owed on the property. Believe it or not it is usually eager to accept a discount because foreclosure is very expensive.

Learning how to negotiate a discount on a mortgage can be the difference between foreclosure and a clean break. A homeowner can learn how and find a buyer to purchase their house quickly for a great price.

The loss mitigation department is the department you will contact to request the bank’s requirements for a short payoff. You must always request a deficiency in order to protect the homeowner from signing to agree to pay back any forgiven debt.

Thanks to the Mortgage Debt Relief Act that was recently passed by congress, homeowners of a primary residence will not be required to pay tax on any forgiven debt. Investor homeowners may still be expected to pay tax on the forgiven debt. Always recommend checking with a tax professional.

After your offer is submitted, it can take many days or weeks to hear back. Being persistent but patient will pay off and if you have asked for a reasonable discount your chances are good of getting an acceptance letter.

Understanding and learning a short sale or payoff of a home can help you out of a bad situation or become an extremely profitable career niche. Investor and agents that aren’t familiar are doing themselves a great disservice.

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