Carmel Valley Realtors
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SURE Short Sale
San Diego Short Sale
Call us Direct at 858-755-6070
"Thanks so much for being so diligent and getting our short sale completed. You and your team were nothing short of AMAZING.  I feel so much better now that it is behind me. I will refer you to everyone I know that needs to do a short sale!"
Leah H. - San Elijo Hills, CA
SURE Short Sale
Lenders may accept short sale offers or requests for short sales even if a Notice of Default has not been issued or recorded with the locality where the property is located. Given the unprecedented and overwhelming number of losses that mortgage lenders have suffered from the 2009 foreclosure crisis, they are now more willing to accept short sales than ever before. This presents an opportunity for "under-water" borrowers who owe more on their mortgage than their property is worth and are having trouble selling to avoid foreclosure as a result.Multiple levels of approvals and conditions are very common with short sales. Junior lien-holders - such as second mortgages, HELOC lenders, and HOA (special assessment liens) - may need to approve the short sale.

Frequent objectors to short sales include tax lien holders (income, estate or corporate franchise tax - as opposed to real property taxes, which have priority even when unrecorded) and mechanic's lien holders. It is possible for junior lien holders to prevent the short sale. If the lender required mortgage insurance on the loan, the insurer will likely also be party to negotiations as they may be asked to pay out a claim to offset the lender's loss in the short sale. The wide array of parties, parameters and processes involved in a short sale makes it a relatively complex and highly specialized type of real estate transaction. Not surprisingly, short sale deals have a high failure rate and often do not close in time to prevent foreclosure when they are not handled by a knowledgeable and experienced professionals such as SURE Real Estate.

Short sale success rates vary from state to state and from bank to bank. Bank of America short sales, as of 2010 are still the longest to be approved and have the highest failure rate. Whereas, Citibank and Wells Fargo will often move faster. Smaller "local" banks tend to have their own rules, but will typically approve the short sale in days, not months.  SURE has successfully conducted short sales with the the large, national banks and small, local banks, credit unions, and a variety of junior lien holders.
SURE Short Sale Review
  • We Consult
Complicated times require sensitive solutions. Whether you’re struggling with your mortgage payment, you currently owe more than your home is worth, you have been unable to successfully modify your mortgage or simply have questions, SURE can help.
  • We Advocate
Since our parters are actively involved in the largest trade associations and political action groups in an effort to reform and expedite foreclosure prevention under the current housing crisis, SURE has the answers that you need.
  • We Negotiate
Our team is comprised of seasoned professionals whose knowledge and experience spans over the real estate and mortgage industries alike. We are dedicated to helping you  through your struggle and work directly  with all parties.
Short Sales - Overview
The simple definition of a "real estate short sale" is a sale of real estate in which the sale proceeds is short of the balance owed on the property's loan.  Sometimes it occurs when a borrower cannot make the mortgage payments on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower. The seller and lender agree to the short sale process, because it allows them to avoid foreclosure, which involves higher costs for the bank and a great hit to the borrower's credit score.  This agreement, however, does not automatically release the borrower from the obligation to pay the remaining balance of the loan, known as the deficiency.   If you hire an inexperienced agent who does not negotiate a full release from your lender, then it is possible that you could be liable for the money the lender loses in a short sale or end up being forced to sign a promissory note to get the deal done. SURE does not recommend that our clients sign a promissory note or close escrow without a full written release from their lender(s) and subordiante lien holders.

  • HAFA Short Sale:
When your first mortgage lender agrees to accept a short sale under HAFA, they must agree to give up their right to ask you to repay any part of that debt, whether by cash, a promissory note, or a default judgment in court. The other lienholders may require cash, a promissory note, or a combination of both before they will agree to release their lien.  SURE's negotiation team will negotiate these terms on your behalf.

NOTE:  There are no up front costs to do a SURE Short Sale.  SURE has the lender pay our commission, not you, the seller!
SURE Short Sale Process

  • SURE meets with the Seller for an initial consultation.
  • Agency disclosures and listing agreement are signed by the Seller and SURE.
  • Seller completes a simple "short sale package".
  • SURE lists and aggressively markets the property.
  • Offers are made on the property; seller chooses the best one.
  • SURE and our negotiation team submit the offer with the short sale package and HUD to the lenders and opens escrow.
  • Lender completes a third party BPO (broker price opinion) to determine the home's value.
  • We negotiate the short sale with ALL lien holders.
  • Short sale and terms are approved by all parties in WRITING.
  • We CLOSE ESCROW, seller moves out and gets PEACE OF MIND.
  • TRANSACTION COMPLETE


Disclaimer
  • Important Disclaimer: All information provided herein is general information and is not intended to substitute for informed professional financial, tax, legal, investment, accounting, or other professional advice. SURE does not endorse, and expressly disclaims liability for any of the information herein or any opinion expressed in this content. SURE Real Estate and SURE Short Sale is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan. If you stop paying your mortgage, you could lose your home and damage your credit rating.
Short Sale - Frequently Asked Questions


  • 1. What is a Short Sale?
A Short Sale is simply where your mortgage lender accepts less than what you owe on your home. If you are upside down and need to sell due to a hardship, you may qualify to short sell your home. Mortgage lenders accept short sales because it make more sense and costs them less money then taking the home back as a foreclosure.

  • 2. What is the cost to do a short sale?
When you work with SURE there will be NO up front costs to the sellers. The real estate commissions are paid by the first lien holder.  In a SURE Short Sale, the negotiation fees are paid by the first lien holder or the seller.   The seller does not pay any of the real estate transaction costs with SURE.

  • 3. Will the Seller’s credit rating report be affected if they allow a short sale on their property?
While it is up to the individual lender to decide, what often happens is the loan will be reported as "paid" but it will likely be referenced that says "settled for less" or "settled as agreed". It is far more advantageous to have a short sale referenced versus a foreclosure.  A short sale will exclude one from buying for 24 months, however a foreclosure can stay on a credit report of seven years or more.

  • 4. How long will a short sale take?
The short sale process typically takes about 3-5 month from, start to finish. It can take longer depending on which lender/s you have and how many liens need to be negotiated.  As well, if you have a second mortgage that is behind on payments and have been "charged off" by the lender, it can take longer as often negotiations are done with a 3rd party debt collector.  Our team has had short sales approved in as short as 3 days (but, don't expect that).  Smaller banks are typically much faster, and some banks, specifically, Bank of America, are notoriously slow.

  • 5. Can I stay in my property during the short sale even if my loan is past due or my property is about to be foreclosed?
Keep in mind, even if you are behind on your payments, you still have ALL the rights of ownership of your home.  SURE will give you timelines of lender approval and close date as the transaction progresses.  You should have ample notice as to when the close date will be and can plan your move as you would in a traditional sale. SURE has successfully extended trustee sales on countless properties (that were due to be foreclosed on) and kept our clients in their homes until the short sale process was complete.

  • 6. If there is only one spouse on the Note and Deed, does the other spouse have any liability in the Short Sale Process?
Only the Individual list on the NOTE is responsible for the current mortgage and any liability resulting from the short sale.

  • 7. Will I have to pay any Federal or State taxes if I do a short sale?
FEDERAL TAX CONSEQUENCES
If it is your primary residence, then the answer is no. Congress passed a law entitled The Mortgage Forgiveness Relief Act of 2007 to eliminate this tax. If the Short Sale is occurring from a 2nd home or investment property you may receive a 1099 from the lender. It is required by the lender to submit the formal tax form, but these circumstances are individual to each lender.

However, there are several different scenarios with regard to whether or not you will owe federal income taxes on the loss the lender takes in a short sale. When you do a short sale, your lender is agreeing to settle the debt on the property for less than the amount they are owed. The IRS therefore allows them to write off this loss, which is why your lender will send you a 1099-C after the short sale. The IRS considers “debt relief” to be income for tax purposes. In other words, if your lender writes off $50,000 on your short sale, they will send you a 1099-C for that amount, and you would include that when you file your income taxes. The “C” stands for “Cancellation of Debt” and the law says canceled debt is taxable as income.

There are however a few exceptions that most people who do a short sale qualify for that exclude them from having to pay taxes on their short sale. As a result of the Mortgage Tax Debt Relief Act which was signed into law in January of 2008, homeowners who do a short sale on their primary residence, and have a purchase money loan (in other words, they have not pulled cash out of their home with a cash-out refinance) pay no taxes on the loss that their lender incurs in a short sale. Homeowners who have pulled out cash from their home but have put that money back into their home to “substantially improve” their home, also are excluded from taxes on the short sale. All other short sale scenarios – if you pulled cash out on your primary residence but spent it something other than upgrading your home or if you are doing a short sale on a second home or investment property may result in a taxable event unless you qualify for the “Insolvency” exclusion.  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, you have more debt than you do money or assets, you are considered insolvent. Many people who find themselves facing a short sale are in exactly this situation and are thus excluded from paying taxes on a short sale. We recommend you check with your CPA or accountant or go to the IRS website and look up IRS Form 982, which is the IRS form for debt relief and short sales. The IRS gives an explanation of “Insolvency” on this form.

NOTE:  The time period for The Mortgage Tax Debt Relief Act was originally only due to go until the end of 2008, however it has now been extended to the end of 2012.

CALIFORNIA TAX CONSEQUENCES
California has passed its own version of the federal Mortgage Tax Debt Relief Act. It is Senate Bill 1055, which conforms to the federal law described in detail above, but applies to California state income taxes on a short sale.  There are differences between the state and federal law. For example, the term of the California law was only until the end of 2008. As of Jan 2009, this law is no longer in effect. However, debt forgiveness on non-recourse loans is not taxable in California. In other words, if your lender forgives debt on a purchase money or non-recourse loan, you are not subject to CA state income taxes.

There is pending legislation in the CA legislature at this time regarding the taxation of debt forgiveness on recourse loans. We recommend you review your specific tax scenario with your CPA or accountant and have them answer any tax questions that you have. We are not tax advisors and cannot give tax advice, nor do we claim to.

  • 8. I am current on my mortgage, will my lender consider a short sale?
A common myth with short sales is that you must be delinquent in order to start the short sale process. You do not need be behind in payments but the bank will need to see that you have a hardship. A hardship can be a loss of a job, divorce, a catastrophic medical event, job relocation, or a death in the family. Even if your hardship is not mentioned, you may still qualify for a short sale.  Through experience, SURE has found that it is common for some lenders to be less willing to negotiate in good faith with homeowners that are current on their payments despite new HAFA rules and federal guidelines.

  • 9. I have two (or more) mortgages (or liens).  Can I still do a short sale?
We can work with multiple mortgage lenders (many times the same mortgage lender holds the 1st and 2nd mortgage loan) and lien holders to put together a Short Sale transaction. Even if the value of the home is below the balance of the 1st mortgage, the mortgage lenders are willing to work together to come to a common solution.  In some cases there be additional liens, such as tax liens, or mechanics liens.  SURE's team of negotiators with work with ALL lien holders to have all liens released to complete the short sale.

  • 10. Do I need to write a hardship letter?
Yes, it is required by every lender. Be specific about your hardship. Tell them about your job loss, job reduction or salary, divorce, illness, death. Give the lender specific dates and details and they will empathetic about your situation.  SURE will provide sellers with simple guidelines as to what to include in the hardship letter.

  • 11. How soon can I purchase my next home?
If you continue to pay your bills and have a good payment history, you will be eligible to purchase a new home in only 24 months!
Click here for useful information on the HAFA program recently rolled out by the Federal government.
Click here for the National Association of Realtor's take on HAFA
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If you would like fast answers to your short sale questions please let us know!
SURE is A+ Rated with the BB
SURE Real Estate is the best choice to handle your San Diego Short Sale!
Short Sale Logistics

In a short sale, neither side is "doing the other a favor;" a short sale is simply the most economical solution to a problem. Banks will incur a smaller financial loss than would result from foreclosure or continued non-payment. Borrowers are able to mitigate damage to their credit history, and partially control the debt. A short sale is typically faster and less expensive than a foreclosure. It does not extinguish the remaining balance unless settlement is clearly indicated on the acceptance of offer.

Lenders often have loss mitigation departments that evaluate potential short sale transactions. The majority have pre-determined criteria for such transactions, but they may be open to offers, and their willingness varies. A bank will typically determine the amount of equity (or lack thereof), by determining the probable selling price from an appraisal or Broker Price Opinion (abbreviated BPO).
Short Sales and the Psychological Effects
We put this section first because we realize if you are facing a short sale, whether you are current on your payments or not, it is a highly stressful situation full of questions and uncertainty. We have dealt with folks from all walks have life that due to circumstances beyond their control had no choice but to do a short sale of their home in San Diego. We have seen first-hand the emotional toll it can take on them.  We have handled many short sales for friends and family members as well which has made us more sensitive to just how important it is to provide expertise, accurate information, and guidance throughout this process.

Understand, it does not have to be a highly stressful process if you have the right team of  people on your side with your best interests in mind.  If you are considering a short sale on your San Diego home please contact us and we can guide you through this process and provide you the steady resolve and expertise to making short selling your home as stress-free as possible.  We are SURE!

Carmel Valley Realtors - Short Sale

Short Sale Definition:
The simple definition of a "real estate short sale" is a sale of real estate in which the sale proceeds is short of the balance owed on the property's loan. Sometimes it occurs when a borrower cannot make the mortgage payments on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower. The seller and lender agree to the short sale process, because it allows them to avoid foreclosure, which involves higher costs for the bank and a great hit to the borrower's credit score. This agreement, however, does not automatically release the borrower from the obligation to pay the remaining balance of the loan, known as the deficiency. If you hire an inexperienced agent who does not negotiate a full release from your lender, then it is possible that you could be liable for the money the lender loses in a short sale or end up being forced to sign a promissory note to get the deal done. SURE Del Mar Realtors does not recommend that our clients sign a promissory note or close escrow without a full written release from their lender(s) and subordinate lien holders.

When your first mortgage lender agrees to accept a San Diego short sale under HAFA, they must agree to give up their right to ask you to repay any part of that debt, whether by cash, a promissory note, or a default judgment in court. The other lien holders may require cash, a promissory note, or a combination of both before they will agree to release their lien. SURE's negotiation team of Carmel Valley realtors will negotiate these terms on your behalf.

NOTE: There are no costs to the seller to do a SURE Short Sale, the bank pays all our fees!

Lenders may accept short sale offers or requests for short sales even if a Notice of Default has not been issued or recorded with the locality where the property is located. Given the unprecedented and overwhelming number of losses that mortgage lenders have suffered from the 2009 foreclosure crisis, they are now more willing to accept short sales than ever before. This presents an opportunity for "under-water" borrowers who owe more on their mortgage than their property is worth and are having trouble selling to avoid foreclosure. As a result, multiple levels of approvals and conditions are very common with short sales. Junior lien-holders - such as second mortgages, HELOC lenders, and HOA (special assessment liens) - may need to approve the short sale.

Frequent objectors to short sales include tax lien holders (income, estate or corporate franchise tax - as opposed to real property taxes, which have priority even when unrecorded) and mechanic's lien holders. It is possible for junior lien holders to prevent the short sale. If the lender required mortgage insurance on the loan, the insurer will likely also be party to negotiations as they may be asked to pay out a claim to offset the lender's loss in the short sale. The wide array of parties, parameters and processes involved in a short sale makes it a relatively complex and highly specialized type of real estate transaction. Not surprisingly, short sale deals have a high failure rate and often do not close in time to prevent foreclosure when knowledgeable and experienced professionals such as SURE Real Estate do not handle them.

Short sale success rates vary from state to state and from bank to bank. Bank of America short sales, as of 2010 are still the longest to be approved and have the highest failure rate, whereas Citibank and Wells Fargo will often move faster. Smaller "local" banks tend to have their own rules, but will typically approve the short sale in days, not months. SURE has successfully conducted short sales with the large, national banks and small local banks, credit unions, and a variety of junior lien holders.

A Short Sale is simply where your mortgage lender accepts less than what you owe on your home. If you are upside down and need to sell due to a hardship, you may qualify to short sell your home. Mortgage lenders accept short sales because it make more sense and costs them less money then taking the home back as a foreclosure.

Since our partners are actively involved in the largest trade associations and political action groups in an effort to reform and expedite foreclosure prevention under the current housing crisis, SURE has the answers that you need.

  • Are you at risk of losing your home through foreclosure?
  • Have you missed your last mortgage payment, or are about to do so?
  • Is your home now worth less than when you bought it?
  • Do you want to move on with life and start fresh?
  • Do you feel trapped by your mortgage and have no idea how to get out?

SURE has an A+ Rating with the BBB
A+ Rating
  • Our Team has a 96% Approval Track Record
  • Over 500 Short Sale Approvals...and Counting!
  • NO COST TO YOU!
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