Short Sale and Deficient Amount

Hi Raymond,

If you go for a short sale, then you would be liable to pay the deficient amount resulting from the sale of the property. It will depend upon the lender whether he would forgive the balance amount. If the lender is not ready to negotiate with you, then you'll have to pay off the deficient amount.

A short sale will lower your credit score by 80-100 points.

Thanks

Raymond,

pricipally you are answerable for paying off your mortgage. deficit can be fogiven by lender. but not sure.

My questions is how can I negotiate this with the bank?

DO I need realtor or a lawyer?

This is an interestign topic.

I would love to see some good answers, since I also may consider looking at this options, if the lnder refuses loan modification

Probably you need a realtor who is a short sale specialist

Raymond,

Welcome to forum

I should suggest you you need arealtor who is a short sale specialist

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This is good explaination, but I did nit get the second one

Also it does nto answer my question about how do we make sure that I am not responsible for the deficient amount

Thank you

If you have taken the loan in your name, then you would be responsible for deficient amount resulting from the sale of the property. It would depend upon the lender's discretion whether or not he would forgive your deficient amount.

Is there any way know before the we sell the house or we will only know after we sell the house

Hi Raymond,

You can check out with your lender whether or not he would forgive the deficient amount resulting from the short sale of the property. If he agrees to it, then you won't have to pay the balance amount but you may be responsible for paying taxes as it would be considered as your income.

Thanks

One Correction James.

You do nto need to pay any taxes o the deficient amount, if the lender agrees to forgive the amount

they will send a 1099C and you need to report it to IRS, but you will not be taxed due to the current law

Good luck and feel free to ask and answer

do you have just a 1st or do you have a 2nd also? On the second you can be made to pay taxes on it. Also the first can be forgiven, yet the second may still seek reimbursement. We are in that now after just getting our short sale approved and now don't know what is going to happen with the 2nd.

It will have a huge impact on your credit. we were in the 750 range and now are in the 500's last time I checked. Unfortunately to get the bank to even start talking with you about a short sale you need to miss payments, at least that is how WaMu is. We knew we were heading for trouble and tried to talk with them, but they wouldn't until we were 3+ mos behind and then your credit just keeps going down. Our short sale took about 7 mos to even get approved from submission of the offer. It is a long road. I almost wish we just foreclosed because this is just craziness. Get lots of info before you do it!

Hi Raymond,

Moral of story is you should catch realtor which can help you in that.
But you have to pay deficient amount as you are going for shortsell depending upon lender.

Best of luck for future.

Can one file for BK to get an automatic stay and then try to short sell?