Avoid Costly Taxes With A Short Sale.
A short sale is the sale of home in which the proceeds are not sufficient to meet the mortgage debt obligation. Short sales have become the preferred option to avoid foreclosure.
When to short sale:
- The property’s value has dropped so that the market value is less than what is owed on the mortgage. Also known as underwater and over leveraged.
- The mortgage is in or near default status – banks typically lose less money on a short sale than a foreclosure.
- Seller has encountered a hardship. Examples of hardships are job loss, reduction in pay, or medical emergencies.
Important items to understand about short sales:
- Arizona law allows homeowners to short sale their properties and be forgiven on the outstanding debt. However, not all homeowners are protected under this law. By meeting with us for a free consultation, we can learn more about your individual situation and assess whether or not you are covered under the law.
- Tax consequences – because of The Mortgage Debt Relief Act, homeowners are able to avoid paying taxes on the forgiven debt. Again, restrictions apply – by consulting with us we are able to determine if you will be required to pay taxes on the forgiven amount.
- Credit rating impacts – Short sales typically ding one’s credit score 80-100 points and typically appears on a credit report as ‘settled.’ Individuals who short sale are typically able to purchase again in 12-24 months. A foreclosure will show up on a credit report as well as damaging the score typically 200-300 points. Also, when applying for a new loan, individuals who have foreclosed must disclose this on the application.
- You can receive $3,000 for short selling – The federal government recently passed the Homeowner Affordable Foreclosure Alternatives (HAFA) program. HAFA streamlines the short sale process and gives incentives to banks and homeowners. Homeowners are able to receive $3,000 for relocation expenses from the federal government. Click here for a list of other programs that can pay you up to $30,000 to short sell!
- Short sale services are FREE – We offer our free consultation services because we believe every homeowner has the right to understand their situation and be presented with alternatives and solutions. We are on pace to perform 600 short sales this year, and have never charged a single cent to a homeowner.
Preferred Real Estate Partner:
A short sale is a complicated process. After meeting with a Real Estate attorney, at no cost to you, if it is determined that you should attempt a short sale, our preferred partner is Strong Tower Real Estate Group, the #1 source for real estate information. You can visit them by clicking on their logo below or contact them at 480.719.3313
