Foreclosure Help | Miramar Florida

What is a short sale?

Why are Short Sales becoming so popular?

How much does a short sale cost?

I want to do a loan modification because I don’t want to lose my

house. What are my options?

I want to do a short sale. How long before I have to leave my

house? I know people that have not made a mortgage payment for years and the bank has not thrown them out yet.

Isn’t it easier to just allow the bank to take back the house

and for me to just wait till they come and kick me out?

I have heard that your credit gets just as damaged

with a short sale as with a foreclosure, so why bother?

But if I do a short sale, don’t I get a deficiency anyway

and still be responsible for the balance?

Well, I have heard you are liable for the tax, and you get a

1099 on the difference.

I have heard that short sales are very hard to do and

that banks don’t always accept them. How can I be sure that won’t happen to me?

What’s in it for me?

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Q. What is a Short Sale?
A. A short sale is when a lien holder accepts less than what they are owed in order to release the lien

from a property so that a property can be sold. The difference in the amount owed and what they actually receive

from the sale may or may not be forgiven by the lien holder, it all depends on how the offer was submitted and how

the short sale was negotiated.

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Q. Why are Short Sales becoming so popular?
A.

1. Financially, many people see no sense in paying more for a house than it is worth, especially as house

   prices in most of south Florida have dropped 40 to 60 % over the past four to five years.

2. It’s an effective way of avoiding foreclosure.
3. You have less chance of getting a deficiency judgment, which could be on your credit for ten

   years.

4. It means that you may be able to buy a house again in two years, instead of 5 years if you let the

   house go into foreclosure.

5. You may be able to buy the next house for as little as 50% of what you currently owe.

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Q. How much do I have to pay to get a short sale done by a professional?
A. You don’t have to pay us anything. All commissions, taxes and closing costs get paid from the proceeds

of the sale. However, if the property is governed by a Condo or a Home Owners Association, then it is recommended

the seller keeps the payments current because in most cases banks will not agree to pay these.

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Q. I want to do a loan modification because I don’t want to lose my house. What are my

options?
A. We encourage sellers to try to do a loan modification first. However, keep in mind that most banks do

not want to modify loans. It’s very difficult to get approved and it can take months. It’s like making a loan

application from scratch. Banks are looking for full documentation of income, including tax returns, pay stubs and

bank statements.
Also, a loan mod application doesn’t stop the lawyers from the collection department from pursuing a foreclosure

action against you.
Even if you are successful, you may end up having the arrears tacked on to the end of the loan and since banks are

rarely doing principal reductions you will end up paying hundreds of thousands of dollars more than what the house

is worth, plus interest.

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Q. I want to do a short sale. How long before I have to leave my house? I know

people that have not made a mortgage payment for years and the bank has not thrown them out yet.
A. There are ways to stall the foreclosure process. However, this may only be a short term solution. If

you want to buy another house in the next few years, these severe delays show in your credit report, which may

condemn you to damaged credit for years. The quicker you take action and get the house sold through a short sale,

the quicker you will be able to buy another house while prices are still low.
However, we work around your schedule. If you need time in your house in order to save money, we are able to keep

you in your home for as long as possible until you are ready.

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Q. Isn’t it easier to just allow the bank to take back the house and for me to just

wait till they come and kick me out?
A. A foreclosure has a devastating effect on your credit. Lenders and creditors in general view a person

doing a short sale as much more credit worthy because it speaks a lot about a person’s willingness to resolve

difficult financial matters and of their character.
Also, it will cost you a lot more in all types of insurance, higher credit rates, not being able to purchase or

lease the car of your choice, not being able to buy a house for years and not being able to act on great deals as

the market worsens.

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Q. Ok you know what, I will just let the bank take the property back, where do I send the

keys to?
A. Some banks will be unable to accept a deed-in-lieu as there is a second mortgage or a lien on the

property. You should also know that a deed-in-lieu is a voluntary foreclosure. This is great for the bank, as it

saves them a lot of money on the legal fees involved in processing a foreclosure. However, it has the same terrible

effect on your credit as a normal foreclosure.

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Q. I have heard that your credit gets just as damaged with a short sale as

with a foreclosure, so why bother?
A. No, no, no! Thousands of people do short sales because it’s the best thing for them and for their

families. A foreclosure will take much longer for you to recover from – at least 5 years until you can buy a home

again, compared with as little as two if you do a short sale. We live in a society where we need credit for many

things such as insurance, credit cards, car loans, employment. All of these will be severely affected if you have a

foreclosure in your credit, whereas banks are aware that people that do short sales did not just walk away and

chose to sell their house rather than allowing it to be repossessed.

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Q. If I do a short sale, won’t I be responsible for the balance?
A. Most of the times we manage to get full settlement with the banks. This is because we know how to

negotiate and because we know what the banks need to reach this point. Most realtors are not skilled in this area,

and most lawyers take the easier, most profitable way out for themselves without really taking into consideration

the medium to long term consequences of their advice on the client’s lives.

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Q. Well, I have heard you are liable for the tax, and you get a 1099 on the

difference.
A. Most people are not liable for this tax thanks to the Mortgage Debt Forgiveness Act, and as an added

bonus you may not have to pay tax thanks to a great clause from the IRS code. Check with your accountant.

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Q. I have heard that short sales are very hard to do and that banks don’t

always accept them. How can I be sure that won’t happen to me?
A. The first tip is to keep all your home owners’ associations up to date. Make sure that you work with

someone who has a successful track record. Be ready to cooperate, and in our case, we close 95% of all deals where

the seller cooperates. We have one of the highest closing rates in the industry, so you would be dealing with

experts.

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Q. What’s in it for me?
A.

1. See “Why are short sales becoming so

   popular?”

2. Your credit will be in much better shape, which will save you thousands of dollars, and you will be

   able to take advantage of great deals much sooner.

3. We can help you with moving expenses.
4. You have control and peace of mind while living in the house, knowing that you won’t get kicked out.

   Also, see “Short Sales vs Foreclosure.”

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REMEMBER: With foreclosure being such a prominent issue there is a lot of misinformation online.

We strive to provide you with the latest and most up-to-date information regarding foreclosures and how to prevent

them. However, it is of the utmost importance for you to understand that the information we provide is our

professional opinion. We do not offer legal or financial advice in any way. Not on our site, and not through our

agents. If you are looking for such advice, it is best to contact an attorney or accountant. We hope you find the

information we provide helpful