Oregon Short Sales

BEWARE!!! Debt Relief Act Coming To An End

Stacy Owens — Thu, 16 Feb 2012 18:03:56 +0000

The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

Have you heard of the mortgage forgiveness debt relief act? This is an important act that has helped make Short Sales a viable option for many. When you have a debt forgiven (in a short sale it would be the bank forgiving part of your debt), you have to pay income tax on the debt that has been forgiven. The debt relief act of 2007 made it possible for people to be exempt to this rule when applied to their main residency.

This ends in 2012

The debt forgiveness act applies to debt cancellations that occur between 2007 and 2012. This is 2012 folks, and there is no sign of the debt relief act being extended at this time. That means in the future you may likely have to pay taxes on the amount forgiven by a bank during a short sale or foreclosure.

How does the IRS know my debt has been canceled?

When a bank forgives a debt (over $600) they are required to fill out a form 1099-C to report the amount of the debt cancellation. That means you better report it on your end as well. And if you need to short sale your home, you may want to try to get it taken care of before the end of the year, so your debt may not be taxable.

For more information – visit the IRS website.

Featured Short Sale: 107 E 9th St Newberg OR 97132

Stacy Owens — Thu, 26 Jan 2012 14:52:22 +0000

107 E 9TH ST Newberg, OR 97132

This Newberg Oregon home has great potential as a starter home or an investment home. With three bedrooms, living room, dining room and kitchen, this home is making the most of the 1040 square feet. Perfect for a get together, you can be in the dining room talking to someone making dinner and still talking with someone in the living room. This bungalow style home has a one car garage as well.

Address: 107 E 9TH ST Newberg, OR 97132
Bed/Full Bath: 3/1
Sq. Ft.: 1040
Price: $170,000 (Short Sale)Email your Realtor Stacy Owens to schedule a viewing of this property

View a virtual tour of 107 E 9TH ST Newberg, OR 97132

Check out other Newberg Short Sales starting under $100,000.

Listing and Receiving a Short Sale Offer

Stacy Owens — Tue, 17 Jan 2012 17:59:45 +0000

You’re Still the Owner

Because you are still the owner, you still have the power to accept, reject or counter offers made on your home. It’s best to talk with a Real Estate Attorney to find out what all the best options are for you so you can make wise decisions along the way.

Time Frames and Contingencies

If you’ve never been part of the short sale process before, you might be surprised at how long the process can take. There are a lot of parties involved, so there are a lot of things to coordinate in order to actually make a short sale work. Give Short Sale Specialist Stacy Owens a call to get a accurate picture of how the process will go, or attend one of her Free Short Sale Seminars and get your questions answered there. Bank Approval Contingencies may also be in effect during your short sale. This is a contingency designed to protect the buyer if the short sale isn’t approved by the bank. For the seller, it really translates into the time between when you accept the buyers offer and when the bank does. It’s a sign you’re one step closer to completing the short sale process.

Short sale Paperwork

Paperwork is not a word that brings visions of fun an laughter to the mind. In a short sale there will be quite a bit of paperwork that the seller will have to work through. That’s why having a short sale specialist help you through the process can make things go a lot smoother. Some of the paperwork will be provided by the seller, but some of it will be filled out by your Real Estate Agent.

Communication with the servicer (lender)

Not every real estate agent is willing to put in the work it takes to get a short sale pushed through. It takes a lot of time and communication with the lender(s). Sometimes the only way to get a short sale through is to continue to keep your short sale on the top of the pile. That means that your real estate agent has to have a lot of tenacity to see the short sale through to completion.

Time frame for response to short sale offer

There are a lot of things that can affect the time frame in which you get a response from a short sale offer. Sometimes a short sale is pre-approved for a certain amount. If there is a number already approved, you can skip the negotiating and write the offer for that amount. If there isn’t a price agreed on, the servicer will likely ask for an appraisal. The process generally takes longer than a traditional home sale.

The buyer’s right to terminate

It’s important for seller’s of a short sale to understand that in a short sale, the buyer has the right to terminate the agreement and offer up to the time that the bank has approved the short sale. This can be frustrating, but working with the right real estate agent can help you navigate these waters more easily.

Bank Approval Contingencies

Stacy Owens — Tue, 17 Jan 2012 17:38:53 +0000

Short Sale Bank Approval Contingencies are Important

In a short sale all things are dependent on the bank and their willingness to sell the home at a loss. For the protection of the buyer, a bank approval contingency should be attached. That way if the bank approval doesn’t come through, the buyer isn’t obligated to the agreement to purchase. If all other contingencies are met (like financial contingencies, inspection contingencies, or expiration date contingencies), and the bank does approve the short sale, then the home will enter escrow. Basically the bank approval contingency in a short sale is the time between when the seller has accepted the offer and the time the bank approves or denies the short sale.

Before a short sale: Know Your Loans

Stacy Owens — Thu, 22 Dec 2011 18:00:10 +0000

What Kind of Loans do you have?

Sometimes we have more than one loan on our home. It’s important before you start your short sale to have the information about your loans available to you so there are less surprises along the way.

Multiple Loans

Sometimes you might have more than one loan on your home. It’s important to know if the loans are with the same lender or if you’re going to have to deal with more than one lender throughout the short sale process. The Short Sale process is usually a bit easier if your loans are all with the same lender.

HELOC

If you have a Home Equity Line Of Credit, you’ll want to consider how that might be affected by a short sale. Sometimes the HELOC is not included and the lender of that line of credit wishes to continue being paid on a monthly basis. Because there is still money attached to the home that way, it can make a short sale more difficult. If the lender for the main loan on the home is really motivated to short sale the home, sometimes they’ll give the HELOC an incentive to sign off on the loan so the short sale can still go through. An HELOC is definitely something you’ll want to make sure your real estate agent is aware of at the outset of your short sale discussions.

80/20 loans

An 80/20 loan is really two loans on your home one for 80% of the cost and another for 20% of the homes cost. The second is usually piggy backed on the first one, and is usually from a different lender than the original lender. These kind of loans aren’t happening as much lately, but they do come into play for short sales. When you have an 80/20 loan, you need to get approval from both lenders in order to proceed with the short sale. Because the secondary lender may not receive any money from the short sale, they may not be willing to discuss a short sale and might just want it to go to foreclosure.

Knowing what kind of home loans you have before you start discussing the option of a short sale with your real estate agent will help you to have a clearer conversation and a more direct plan.

Available Programs for those considering Short Sales

Stacy Owens — Tue, 13 Dec 2011 16:48:17 +0000

Short Sale Sellers may have options

There are quite a few programs that are available for those considering a short sale. Each have their own requirements, so you have to really think through these options.

Available Programs for Short Sales:

HAFA
FHA
Co-op Agreements

HAFA: Home Affordable Foreclosure Alternatives Program

You may be eligible to apply if you meet all of the following: (more info at http://www.makinghomeaffordable.gov)

You live in the home or have lived there in 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 or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.

*Eligibility criteria are for guidance only. Contact your mortgage servicer to see if you qualify for HAFA.

FHA:

The FHA (Federal Housing Administration) has brought together a lot of Federal resources to help reduce mortgages and to help those who find themselves unemployed. To find out more about FHA and Short Sales when you have an FHA Loan, check out http://portal.hud.gov. There you’ll find information about:

Modifying or Refinancing Your Loan for Lower Payments
“Underwater” Mortgages
Assistance for Unemployed Homeowners
Managed Exit for Borrowers
FHA-Insured Mortgages

Before You Short Sale your home:

Find out from your lender what kind of loan you have
If you don’t qualify for a government assistance style Short Sale, do they offer a co-op agreement?
Also find out how 2nd lien holders are handled (i.e. credit card, HOA, Utilities, Attorney, IRS)

For more information on avoiding foreclosure through a Short Sale, contact Stacy Owens at stacy@stacysellsyourhome.com or 503-267-3099

Short Sale Qualifications and Hardships

Stacy Owens — Tue, 29 Nov 2011 15:54:46 +0000

For a short sale, you must have a documented hardship.

The banks are currently requiring that you have a hardship, and usually it has to be a pretty valid hardship.

Some examples of past Short Sale hardships:

Divorce
Losing a job
Incarceration
Medical Issues

In a Short Sale, be prepared to provide all the paperwork required

Short sales are notorious for being complicated and having a lot of paperwork. This is part of the process. It’s not always an easy process, but the advantages can often out weigh the alternatives. Make sure you’re part of the whole Short Sale process, and try not to get frustrated with all the information the bank or your real estate agent asks you to provide.

Short Sales: Use Experts!

Stacy Owens — Tue, 18 Oct 2011 15:07:55 +0000

Short Sale homes come with a lot of complicated and time consuming work. Maybe you’ve already experienced some of that. Each part of the short sale process brings up important issues for buyers and sellers, but especially for sellers. Some things to think about with a short sale are the income tax implications, liability issues for unpaid mortgage indebtedness, your credit rating, bankruptcy and other legal issues that can cause a short sale to go well, get complicated, or stall all together.

Stacy Owens is a Short Sale specialist, in that she has done the realtor’s part of the job in many short sale transactions. That means she’s negotiating on your behalf with the lenders and with the other real estate agents. She helps you to navigate the short sale selling process.

Because Stacy is not an expert in lending, law or taxes, she has decided to put together Short Sale seminars where you’re able to get some of your short sale questions answered. At these seminars you’ll have access to a real estate attorney, a cpa, a lender and Stacy Owens to help answer the questions you didn’t even know to ask. RSVP for one of Stacy’s Oregon Short Sale seminars and start the short sale process with confidence.

Information on this Short Sale Blog is intended as helpful information and should not be considered legal advice and should not be used in lieu of consulting professional legal, tax and credit advice. Contact Stacy Owens at 503-267-3099 for references for professional contacts.

Short Sales with additional offers

Stacy Owens — Mon, 17 Oct 2011 14:18:17 +0000

In short sales, third party creditors are working to get the highest and best offer for the property. In order to make sure that they’re getting the best price for the short sale home, they may require that the home stay on the market, notwithstanding a pending transaction. In some short sales, a creditor may refuse to agree to a pending transaction, because they want the seller to accept another offer, or potential offer with a better price or terms for the creditor. This is one of the bigger hurdles for the entire short sale process, and can cause significant risk of delay or failure of the sale. This is why it’s important to get the help of a Real Estate Agent like Stacy Owens, who can help navigate the challenges of a short sale, and negotiate with the creditors on your behalf.

Information on this Short Sale Blog is intended as helpful information and should not be considered legal advise and should not be used in lieu of consulting professional legal, tax and credit advice. Contact Stacy Owens at 503-267-3099 for references for professional contacts.

Short Sale buyers due diligence contingencies – know the risks

Stacy Owens — Thu, 13 Oct 2011 15:06:20 +0000

The short sale transaction can create a situation in which the deadlines for completion of the buyer contingencies may have to be suspended until you get the third-party creditor’s consent. But, if third party consent is slow and the buyer wants to keep going, the buyers must understand the risk they’re taking. The buyer risks expending their funds, and may find out later that the creditor’s consent for the Short Sale couldn’t be obtained. When this happens, buyers have no recourse for the recovery of their expenses for these projects.