You are searching the Internet for answers. You have learned your home is not worth what you thought, you need or want to sell, you cannot rent your home for what the mortgage payment is....you are STUCK.
A short sale may be your best option.
Remember back when you purchased your home? Remember the lender needed two years tax returns, two months bank statements, two years W-2's ( or 1099) and they needed two months current pay stubs not to mention other things. Well the process of selling by short sale is simply the same process only in reverse. You need to show the bank that you are on a slippery slope. That you cannot rent your home, or sell your home for what you owe on it and you need to do a short sale.
However, I need to share with you some important information. The Mortgage Debt Relief Act expires at the end of 2012. This bill was signed in 2007 and it was extended due to the struggling economy. What this act does is it protects homeowner who get Short Sale Approval from their mortgage company. In other words if your home sells for $200,000 less than what you paid for it, you will not be taxed on the difference. After 2012, if the bill expires...they we revert back to what has always happened if you asked your bank for a short sale.
Twenty years ago, if you requested to sell short, the bank would have said yes. But... they would have stamped your mortgage as not paid in full. Then you the homeowne would have received a 1099 form for the difference. Depending on your tax rate that could be a significant payment to the IRS!
Currently the HAFA Program is the best program out there. I have helped several homeowners get HAFA Short Sale Approval. HAFA gives you to homeowner $3000 at closing to help with moving costs. If you are accepted into HAFA their is no deficiency judgment! That is a huge incentive. The HAFA program is set to expire on December 31st, 2012.
Who is eligible? You may be eligible for HAFA if you meet all of the following criteria:
- You live in the home or have lived there within the last 12 months.
- You have a documented financial hardship.
- You have not purchased a new house within the last 12 months.
- Your first mortgage is less than $729,750.
- You obtained your mortgage on or before January 1, 2009.
- You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.
Here is the form to get started with HAFA.
Here is more information on our website on how to begin the process of a short sale. Don't wait...most of these programs expire at the end of 2012. You will KICK YOURSELF if you miss that deadline. The short sale approval I received this past week for one of our sellers took a total of 60 days from start to finish. They go to closing at the end of the month.
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Contact Peggy James or Erick Blackwelder of Erick and Company of Exit Choice Realty, Woodbridge VA. Realtors®, call 703-851-3085(Peggy) 703-590-2252 (Office).Give us a call and we can "GET YOUR HOME SOLD FAST"to list your property for sale we service Woodbridge, Lake Ridge, Westridge, Old Bridge Estates, River Falls, Middle County, Manassas,Gainesville, Garrisonville and Triangle area's.Basically all of Prince William County Virginia. Manassas Park, Haymarket,Montclair, Dumfries, Quantico, Fort Belvior, Occoquan, Dale City.
