Short Sale Basics

Short Sale Basics

There are situations in which properties are in foreclosure with negative equity, where the seller owes more than the property is worth. Under these circumstances, lenders may be willing to accept less than the full amount due. This known as a "short sale."

For homeowners, this means that if there's no way to make mortgage payments on time and if the home is worth less than what is owed, a foreclosure doesn't have to be the only way out. Short sale means selling a house for less than what is owed on the mortgage, given that the lender agrees to it. The rest of the debt is usually forgiven since it outweighs the negative and time consuming effects of foreclosure proceedings.

Short sales are known to be a win-win situation for all parties involved, including the seller, buyer and lender. The seller doesn't have to face bankruptcy or foreclosure and is no longer liable for the mortgage. The buyer purchases a home at the market rate. The lender also benefits because the losses are minimal compared to being stuck with property after foreclosure.

If not properly addressed in advance, a short sale transaction can have legal consequences and even lead to loss of investment. Since reductions are taxable, you must complete the short sale correctly, so that the loan balance forgiven is not counted as income on your taxes. It is important to negotiate terms and conditions so that the short sale transaction will not have serious consequences for the homeowner and buyer. That's just one of the reasons why short sale should be carefully considered and terms should be outlined before-hand.

Seeking the advice of a qualified short sale attorney is advised. An attorney can assist in reviewing the terms and conditions, negotiating disputes and completing a short sale for homeowners and buyers. An attorney is a good resource to have for minimizing risks of potential problems.

If you are considering or are in the process of a short sale and need the assistance of a short sale attorney, call Attorney Search Network. Attorney Search Network can help you locate a short sale attorney in your area with experience in short sales.

If you have any questions about the information provided above, please contact Attorney Search Network.

Contact Attorney Search Network for an Attorney Referral to an pre-screened Short Sale Lawyer.

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