Welcome to the Short Sale Guidance
Center
Do you owe more than your home is worth?
Is your loan modification
going nowhere?
If a "Notice of Default" has been recorded to
start foreclosure proceedings on your home.
I have created this website to help you understand your options and what all of this means to you and your future.
What is a short sale?
A short sale, is a sale of real estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property and the property owner cannot afford to repay the liens' full amounts, whereby the lien holders agree to release their lien on the real estate and accept less than the amount owed on the debt. Any unpaid balance owed to the creditors is known as a deficiency.
What are the Benefits of working with me?
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STAY IN YOUR HOME LONGER – I can help you stay in your home longer and I may even get your mortgage lender to pay you a relocation fee
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FREE – My services are at NO COST to the Seller
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EXPERIENCED – I have the staff, relationships and expertise to handle the complicated process of a successful Short Sale.
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PROFESSIONALS – We take pride in maintaining the highest standards in customer service.
KNOWLEDGABLE – After one phone call you’ll know why we are recognized as the authority in Short Sale and loss mitigation services. - CONFIDENTIALITY – Your privacy is our promise.
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CARING – You are not alone, we understand these difficult times.
and I will get a hold of you at your desired time for a no-obligation consultation.
OR Call my personal cell phone right now 818-203-5644
and speak directly to me. My services are FREE of charge to the seller.
1.Can anyone do a short sale?
The answer is surprisingly NO! The homeowner must “qualify” for a short sale.
Usually this requires some sort of financial distress; loss of job, medical
situation, divorce or even death of a spouse. A short sale is not the answer
for everybody. Every person’s situation needs to be assessed by a professional
during a consultation. I will be glad to give you a free consultation with no
obligation to determine if short selling is the right choice for you. Call me
now Chris Curcuru at 818-203-5644 or 323-559-7767
Less Damaging to Credit Rating: A Foreclosure will severely damage
your credit rating for 7 years, but a Short Sale is less damaging and its
effect does not last as long.
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Major Banks are Encouraging Short Sales over Foreclosure: Fannie
Mae (FNMA) recently changed their underwriting policy so that a past homeowner
now has to wait 5 years after a Foreclosure before FNMA will underwrite a new
loan. If the homeowner conducted a Short Sale the wait time is just 2 Years!
Freddie Mac also offers participating Banks a $2,200 incentive to conduct a
Short Sale versus Foreclosure.
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Probable Relief from HELOC 2nd Mortgage: When the 1st Mortgage Bank forecloses, the 2nd TD HELOC loan is not deleted from your debt. The 2nd TD HELOC Mortgage Bank may take legal
means to collect their debt after the Foreclosure. With a Short Sale, we negotiate with both lenders to highly reduce or totally eliminate the HELOC loan debt.
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Dignified Solution: With a Short Sale, we sell your home just like your neighbors have done. It’s a dignified resolution to a tough situation. On the other hand, after a Foreclosure, a Sheriff performs a lock out, the grass turns brown, and a Bank Sales Rep places “Bank Foreclosure For Sale” signs in front of the property for your neighbors to see.
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Much Shorter Delay to Renewed Loan Worthiness:
We have established an association with a National Credit Restoration firm. This firm has been able to make major improvements to the credit ratings of our past short sale clients, within months. But they have extreme difficulty in making improvements to damage on credit reports resulting from foreclosure.
"Cash for Cooperation": Some of the banks we work with are now offering home owners a Cash incentive in order to Cooperate with a short sale, versus allowing the property to be Foreclosed on by the Bank. Which Banks and amount of Cash offered, is on a case by case basis.
It
is important to consult a tax attorney, CPA or a tax professional that is
qualified to determine your tax situation.
Federal Taxes: The Home Mortgage Forgiveness Debt
Relief Act of 2007 states if the property is your primary residence and the
debt discharged was from your original “purchase money” loan, and then you will
not have to pay the taxes for that amount. Further, if you did refinance and
used the money to only improve your home, then you may be eligible for
exclusion of the taxes as well. This act has been extended until the end of
2012. Please check the IRS website for updated information.
If
you refinanced your home and pulled the money out for other expenses or it is
not your primary residence, then it is possible that you may have to pay the
taxes unless you are eligible for “insolvency.”
The
IRS does not require you to pay taxes on the loss the lender takes in a short
sale if, at the time of the short sale, you are insolvent. Insolvency means
your debts (including your mortgage) exceed the value of all your assets. In
other words, if, at the time of the short sale, your debt is greater than your
assets, then you are insolvent. Ask your tax advisor if you are eligible for
the Debt Relief Act qualifications or are eligible for “insolvency” and filing
the IRS Form 982.
State Taxes: The state of California conformed to the
federal tax exemption (Home Mortgage Forgiveness Debt Relief Act of 2007) with
its own senate bill 401 but it does have some differences. Ask your tax adviser
if you qualify for an exemption of the state taxes for a short sale. The State
of CA also has an insolvency exclusion to ask your tax advisor about.
It
is important to understand tax implications can apply whether you do a short
sale, deed in lieu or a foreclosure.
There
are two parts and scenarios that need to be considered for this answer. Let’s
start with how it will be reported to the credit bureaus. While in most cases,
short sale and foreclosure, the delinquent mortgage will negatively affect
their credit rating, at least short sellers will have type of verbiage stating
that they worked out a deal with their lender. Such terms reported by lender
are “debt settled for less than what was owed”, “debt settled”, “debt settled
with agreement” or some other similar verbiage dependent on each lender. A
short sale can possibly be less damaging to your credit point wise and there
are cases where the damage was as little as 50-100 points, compared to a
foreclosure which mortgage and credit experts say that, after bankruptcy,
having a foreclosure on your credit report is the worst result and will
possibly reduce your credit score by over 300-400 points.
The
next situation that plays out as to your credit damage is whether you are late
on your payments or not. Once you stop making payments lenders will report you
30, 60, 90 days late all the way out to 150 days late which all contributes to
the degradation of your credit. If you have two loans then the damage can be
even greater. People who are late on their payments will suffer much more
severe credit damage than those who never miss a payment and do a short sale.
And YES you can do a short sale even if you are not behind on payments.
People
who successfully complete a short sale may also qualify for a mortgage at a
reasonable interest rate in as little as 24 months. So, if buying a home is a
future goal, then a short sale is the better option for many families. Fannie
Mae and Freddie Mac have recently changed their guidelines (August 2008)
stating if you have a short sale on your record you may be able to buy another
home in 24 months with financing that is ultimately going to be backed by them.
While if you have a foreclosure on your record you will have to wait 7 years
with financing backed by Fannie or Freddie.
There
are two types of loans in CA. That is “non-recourse” and “recourse”. A
“non-recourse” loan is one you obtained to initially purchase the home. If you
go through a non-judicial foreclosure process with a “non-recourse” loan the
bank will not be able to come after you for the difference.
UPDATED
7-18-11: Due to CA Senate Bill 458, that modified the CA Civil Code Procedure
580(e), a bank may not come after a homeowner for the remainder of the balance
on a short sale for any loan. Not only that but banks are not even allowed to
ask for any money or contribution in the short sale process. This is a BRAND
NEW law that went into effect on July 15th, 2011. There are a certain amount of
exclusions for homeowners so it is important to talk to someone qualified and
knowledgeable in short sales. This law DOES apply to any home including primary
residence, investment properties and second homes. If does NOT apply however
for homes owned by a corporation or LLC. (see below for the actual law 580(e).
This
may however cause some problems with short sales as 2nd lien holders may not
accept a lower amount of money to go away and may ask for more money. This
could result in the the 1st lien holder not contributing that the second wants
and cause a foreclosure scenario. This again is why it is so important to work
with an experienced short sale broker, to be able to get the two banks to agree
to the short sale when there are two lenders involved.
The
ultimate goal of a short sale, however, is to get a full release in an approval
letter which will absolve you from having to pay back any deficiency. If you
decide to work with me, you will have the opportunity to review the approval
letter with a real estate attorney.
Here
is the actual CA Civil Code procedure 580(e) that addresses short sales.
judgment shall be requested or rendered for any deficiency upon a note
secured solely by a deed of trust or mortgage for a dwelling of not more
than four units, in any case in which the trustor or mortgagor sells the
dwelling for a sale price less than the remaining amount of the indebtedness
outstanding at the time of sale, in accordance with the written consent of
the holder of the deed of trust or mortgage, provided that both of the
following have occurred:
(A) Title has been voluntarily transferred to a buyer by grant deed or by
other document of conveyance that has been recorded in the county where
all or part of the real property is located.
(B) The proceeds of the sale have been tendered to the mortgagee,
beneficiary, or the agent of the mortgagee or beneficiary, in accordance
with the parties’ agreement.
(2) In circumstances not described in paragraph (1), when a note is not
secured solely by a deed of trust or mortgage for a dwelling of not more
than four units, no judgment shall be rendered for any deficiency upon a
note secured by a deed of trust or mortgage for a dwelling of not more than
four units, if the trustor or mortgagor sells the dwelling for a sale price
less than the remaining amount of the indebtedness outstanding at the time of
sale, in accordance with the written consent of the holder of the deed of
trust or mortgage. Following the sale, in accordance with the holder’s written consent, the voluntary transfer of title to a buyer by grant deed or by other document of conveyance recorded in the county where all or part of the real property is located, and the tender to the mortgagee, beneficiary, or the
agent of the mortgagee or beneficiary of the sale proceeds, as agreed, the
rights, remedies, and obligations of any holder, beneficiary, mortgagee,
trustor, mortgagor, obligor, obligee, or guarantor of the note, deed of trust,
or mortgage, and with respect to any other property that secures the note,
shall be treated and determined as if the dwelling had been sold through
foreclosure under a power of sale contained in the deed of trust or mortgage
for a price equal to the sale proceeds received by the holder, in the manner
contemplated by Section 580d. (b) A holder of a note shall not require the trustor, mortgagor, or maker
if the note to pay any additional compensation, aside from the proceeds of
the sale, in exchange for the written consent to the sale.
(c) If the trustor or mortgagor commits either fraud with respect to the
sale of, or waste with respect to, the real property that secures the deed of
trust or mortgage, this section shall not limit the ability of the holder of
the deed of trust or mortgage to seek damages and use existing rights and
remedies against the trustor or mortgagor or any third party for fraud or
waste. (d) (1) This section shall not apply if the trustor or mortgagor is a
corporation, limited liability company, limited partnership, or political
subdivision of the state. (2) This section shall not apply to any deed of trust, mortgage, or other
lien given to secure the payment of bonds or other evidence of indebtedness
authorized, or permitted to be issued, by the Commissioner of Corporations,
or that is made by a public utility subject to the Public Utilities Act (Part 1
(commencing with Section 201) of Division 1 of the Public Utilities Code).
(e) Any purported waiver of subdivision (a) or (b) shall be void and
against public policy. SEC. 2. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the meaning of
Article IV of the Constitution and shall go into immediate effect. The facts
constituting the necessity are:
In order to mitigate the impact of the ongoing foreclosure crisis and to
encourage the approval of short sales as an alternative to foreclosure, it is
necessary that this act take effect immediately.
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Time is of the Essence.
3 months and 3 weeks before your home is sold at the public Foreclosure Auction
on the courthouse steps. I can almost always get the foreclosure postponed, but only if you call me. Please don't hesitate, or sit in hope that your financial fortunes will significantly change
in the near future. I am here to help you prevent Foreclosure using a dignified
short sale solution. To see if you qualify for a standard or HAFA Short Sale,
or to simply begin the Short Sale proess,
Call me now 818-203-5644 or 323-559-7767
Disclaimer
Legal
information is not the same as legal advice. This site provides information
about Short Sales designed to help users safely cope with their own needs. But
legal information is not the same as legal advice. The application of law
varies with an individual's specific circumstances.
The laws of every state are in constant change, and although we go to great
lengths to make sure our information is accurate and useful, we recommend you
consult a lawyer if you want professional assurance that our information, and
your interpretation of it, is appropriate to your particular situation.
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