~ Traditional Sale, No Loss To Seller
~ Short Sale/Pre-Foreclosure, (Bank settlement of mortgage) Seller has negative equity, you owe more on the home than market value, you are experiecing a hardship and/or you can no longer afford the property
~ H.A.F.A. Program Short Sale, Seller may receive $3000 to $20,000 in relocation costs at closing if your lender (s) agree (s) to the sale
~ Neither Chapter 7 nor Chapter 13 Personal Bankruptcy will prevent foreclosure, if there is an existing lien or mortgagor, the lien holder has the right to repossess
~ Furthermore, if your mortgage is not current, the lien holder has the right to start the foreclosure process
~ Never abandon your home! Voluntary or Deed-In-Lieu of Foreclosure (giving back the keys) will allow the mortgagor to pursue you personally for a deficiency judgment, you will be taxed on the written off balance as income on IRS Form 1099-MISC, your legal bills will mount, you may be forced to file for bankruptcy and your credit may be ruined for the next 10 years! Not recommended
~ Short Sales are a viable option for seller's who may not qualify for the H.A.F.A. Program or if you cannot stay in property until closing. Real estate and closing agents are paid by the mortgagor. You will not receive cash back, but you will be spared credit disaster, the lien will show as a "bank settlement" on your credit report, and your tax liability will be waived if it's your primary residence. You can exit with dignity. Much preferred
~ H.A.F.A. (Home Affordable Foreclosure Alternative) Program Short Sale will net you $3,000 to $20,000 cash back at closing if you stay in the home and the mortgagor agrees to release you from the debt. Real estate and closing agents are paid by the mortgagor, your tax liability will be waived if it's your primary residence, and the lien will show as a "bank settlement" on your credit report. Highly recommended
~ The latter advice is based on real time experience working with distressed homeowners and negotiating many complicated real estate transactions. It is always advisable to consult with an attorney if you are unsure of the consequences.
If your home is causing you pain, it may be time to stop the unnecessary suffering, and all the waiting and wondering when the bank or the law will be coming to kick you out. Admit it, you are in limbo. No one wants to live in limbo, we need stability, peace of mind and happiness in our lives. Short sales are a viable solution if you can no longer keep your home. Get out while you can with some dignity and pride, there is nothing wrong with a graceful exit, you will have raised the curtain on the final act, salvage what's left of your credit and rid yourself of all the stress. I guarantee you'll feel much better.
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