Avoiding Foreclosure Is More Important Than Ever
Attention Distressed Homeowners: Avoiding Foreclosure Is More Important Than Ever!
On January 1, 2013, Congress passed an extension of the Mortgage Forgiveness Debt Relief Act. The extension of this act, which has saved homeowners more than $1 billion dollars in taxes, is great news for struggling homeowners nationwide.
For another year, distressed homeowners can pursue foreclosure alternatives, such as loan modifications and short sales, without paying potentially thousands of dollars in taxes on forgiven mortgage debt.
To learn more about the Mortgage Forgiveness Debt Relief Act and foreclosure alternatives, browse the information on my site and download a copy of my free report entitled “Attention: Distressed Homeowners! Congress Renews Critical Homeowner Relief Program!”
As a real estate professional with the Certified Distressed Property Expert (CDPE) designation, I offer all of my clients the benefit of the best expertise and insights when it comes to foreclosure avoidance.
If your or someone you know is facing foreclosure, contact me for a free, confidential consultation, and I’ll help find the best possible solution.
To view listings for sale visit here.
Don’t Let the Strain of Foreclosure Crush you!
Is the Strain of Foreclosure Crushing You? You have options!
If you or someone you know are among the 10 million homeowners who are falling further behind every month because of an unmanageable mortgage payment, then that weight may feel unbearable. But there is actually some encouraging news:
You have options, and foreclosure is not one of them! A lot has changed since you bought your home.
As a real estate professional with the Certified Distressed Property Expert (CDPE) designation, I offer all of my clients the benefit of the best expertise and insights when it comes to foreclosure avoidance.
Take a look at my site and download a copy of my free report entitled “Is the Strain of Foreclosure Crushing You?” Then contact me for a free, confidential consultation.
If you have any other questions,, please feel free to contact us at 954-993-4104 or by email at Jeannette@CondoDomain.com.
To view potential listings visit here.
Jeannette Neerpat
CondoDomain.com
7727 NW 79th ST
Tamarac, Fl 33321
954-993-4104
Jeannette@CondoDomain.com
Strategic Default vs. Continuing to Pay on an Upside Down Investment Property
The housing market is finally creeping towards a recovery, but several years of declining property values and record numbers of foreclosure actions have left many homeowners stuck in homes that are not even worth what they owe on the mortgages. This is a unique problem for people who own investment properties. When your primary residence is underwater, you still have a vested interest in keeping it because it provides you with a place to live, even if it’s turning into a bad investment. However, when you own an investment property, continuing to pay a mortgage on it when it won’t ever make money for you can seem illogical since you presumably already have a home you are living in. Many owners of investment property are considering a strategic default.
Is Strategic Default the answer?
A strategic default is when a homeowner decides to stop making mortgage payments, forcing the bank into a foreclosure action. The owner will vacate the property voluntarily. While it used to be a controversial and shocking action, more and more property owners are doing it because their mortgages no longer make financial sense. The setback that will occur to a credit score is worth getting out from under a bad investment. Even celebrity financial advisors like Suze Orman are recommending it after all other available alternatives have been tried. You need to expect that you will take a financial hit somewhere – either in your credit rating or in the money you lose on this investment.
If you don’t like the idea of a strategic default, but you are frustrated with paying on an upside down mortgage on your investment property, there are other actions you can take. First, try to get a loan modification from your lender. They can reduce the principal that you owe, or reset your mortgage so that you don’t owe more than the house is worth for the foreseeable future. If your lender refuses to modify your loan, even with the federal programs in place to encourage modifications, you can try to sell it. Getting a price that will pay off your mortgage might be difficult, so you’ll have to ask your lender if a short sale is permitted. In a short sale, you’ll sell the property for less than you owe. If your lender agrees, you don’t have to worry about defaulting.
When a Lender Refuses
When lenders refuse to consider a modification or a short sale, you have to decide whether you are better off with a strategic default or an upside down mortgage. Most advisors will tell you to stick with the mortgage payments if you are only 10 or 20 percent underwater. If you can keep your investment property rented for five or more years, you will at least be able to keep up with the mortgage payments while your home value increases. However, if the investment property is vacant, or if the amount you owe on the home is more than 20 percent of the value, a strategic default might be your best option. It will allow you to leave your investment property behind and rebuild your credit and your financial future.
This post was written for BrowardCountyReview.com by Stephen K. Hachey. Stephen is an Orlando real estate attorney specializing in loan modifications, short sales, foreclosures and much more. He is also the owner of his own practice, the Law Offices of Stephen Hachey, PA.
What is my time frame on my Short Sale?
I have been on several listing appointments for Short Sales, and one of the many questions that I get asked is What is my time frame on my short sale?
To be honest, its hard to really say how long it can take. I have seen short sales last 30 days and others for over a year. It really depends on the bank the lender is with, and who is handling the file. When you are using a CDPE REALTOR (Certified Distress Property Expert), they handle their own files. They will be on top of it, calling and checking on status. If a third-party is handling it and the many others that agents send, they can not call as often. Now I am not saying short sales handled by them or not handled properly, I just see that they take much longer.
Time frames can vary also based on the Listing price. If the home is listed at a fair market value, based on the most recent sales, then you can generally see the home being shown quite frequently. After that when an offer is made, at that point all papers are sent to the lender. At some point the bank will send someone out to value the house, this step usually can take up to 3 weeks. Once the value is in, they will compare it to the offer that was made and will either deny or approve it. If we have an approval, the buyer at that point will have 30 days to close on the home.
Based on the steps above, your average time it takes to sell a Short Sale listing is in and around 60 to 90 days, from beginning to end. Now remember I said AVERAGE….
If you have any questions in regards to short sales, or are interested in listing your home as a short sale in Broward County, please contact me at 954-993-4104 or email me at Jeannette@CondoDomain.com.
Jeannette Neerpat, CDPE, e-PRO
Better Homes
CondoDomain
7727 NW 79th St
Tamarac, Fl 33321
Jeannette@CondoDomain.com
Bank of America to offer Relocation Assistance*** Up to $30,000!
Short Sale Relocation Assistance Program: You may be eligible to receive $5,000 to $30,000 in relocation 
assistance
If you have been contemplating on selling your home as a Short Sale and you have a Bank of America loan…Pay attention, you may be eligible to receive up to $30,000 to help you with moving expenses. Read below to see how it works:
Bank of America is excited to offer enhanced relocation assistance. Qualified homeowners who initiate a Preapproved Price Short Sale (without an offer) could be eligible to receive $5,000 - $30,000* in relocation assistance and owe no more on their mortgage with the sale of their property, depending on the investor involved.
Determining your clients’ eligibility is easy:
The homeowner must participate in one of the Preapproved Price Short Sale Programs, such as:
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HAFA (Home Affordable Foreclosure Alternatives)
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Bank of America’s Cooperative Short Sale Program
Specific investor participation and eligibility criteria do apply to these programs.
Homeowners not meeting eligibility requirements for the enhanced relocation incentive may still qualify to receive $2,500 – $3,000 in relocation assistance from government and bank-sponsored programs.
If you would like a FREE consultation, please feel free to contact me at 954-993-4104 or by email at Jeannette@CondoDomain.com.
Jeannette Neerpat, CDPE, e-Pro
Better Homes
CondoDomain
7727 NW 79th St
Tamarac, Fl 33321
954-993-4104
Jeannette@CondoDomain.com
The Mortgage Forgiveness Debt Relief Act and Debt Cancellation
Have you been behind in your mortgage and have been contemplating on whether or not to list your home as a short sale? Now would be the time to act. The Mortgage Debt Relief Act of 2007 is set to cancel as of December of this year. This cancellation of debt is for the difference of what is not paid on the loan. Read the following off of the IRS site.
If you owe a debt to someone else and they cancel or forgive that debt, the canceled amount may be taxable. The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.
This provision applies to debt forgiven in calendar years 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home’s value or the taxpayer’s financial condition.
More information, including detailed examples can be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments. Also see IRS news release IR-2008-17.
The following are the most commonly asked questions and answers about The Mortgage Forgiveness Debt Relief Act and debt cancellation:
What is Cancellation of Debt?
If you borrow money from a commercial lender and the lender later cancels or forgives the debt, you may have to include the cancelled amount in income for tax purposes, depending on the circumstances. When you borrowed the money you were not required to include the loan proceeds in income because you had an obligation to repay the lender. When that obligation is subsequently forgiven, the amount you received as loan proceeds is normally reportable as income because you no longer have an obligation to repay the lender. The lender is usually required to report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt.
Here’s a very simplified example. You borrow $10,000 and default on the loan after paying back $2,000. If the lender is unable to collect the remaining debt from you, there is a cancellation of debt of $8,000, which generally is taxable income to you.
If you decide to list your home as a Short Sale in Fort Lauderdale, contact me at 954-993-4104 or email me at Jeannette@CondoDomain.com.
Jeannette Neerpat
Better Homes
CondoDomain
7727 NW 79th St
Tamarac, Fl 33321
954-993-4104
Jeannette@CondoDomain.com
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