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tods5eshoes · Wysłany: Sob 21:48, 12 Mar 2011 Temat postu: 5412

Defining Temecula, Murrieta, Wildomar, and Menifee Short Sales.
Temecula Valley short sales are many times mistaken as foreclosures or dwell in that murky area between knowing and understanding for many agents, home buyers, and homeowners. To start this article I want to clearly define what a short sale is:
Definition - A short sale is when the debt obligations on a real estate property are bigger than the overall total value of the home as evaluated by the direct market comparables.
Many Temecula agents and buyers put short sales in the same barrel as foreclosures but they are actually very different. Foreclosures are initiated with a Notice of Default. That notice begins the financial institute's foundation for a foreclosure procedure. Once started, a foreclosure usually take roughly 4-6 months depending on the bank involved with the current owner losing possession and taking a tough credit hit.
However, this circumstance can often be worked out during that 4-6 month time period. This is the reason there has been uncertainity sorting out a short sale versus a foreclosure since they are frequently intertwined. Once a lender has begin a foreclosure route, the current homeowner has a limited time to either bring the payments current or move out of the home.
The other choice is a short sale if the banks agree and thereby debt forgiveness. When making this choice, the owner lists the Temecula or Murrieta property, makes an agreement with the financial institutes and sells the home before the foreclosure process is wrapped up. The deal the seller makes with the banks is for the financial lien holder to take a lesser sum of money than is owed on the loans but result in full debt forgiveness for the owner.
You may wonder why would a bank take less money that is owed? Because, in all honesty they will probably get when they foreclose on the home. The financial institutes often receive more money via a short sale because the seller is taking care of the Murrieta or Temecula home and it sells for a better selling price. The financial institute also dodges the very spendy process of foreclosure while being concerned about one less home in its portfolio. Banks have difficulty keeping track all their homes. And, foreclosed homes often get damaged and vandalized costing the lending company even more money.
So in many situations the short sale a solution that works out for the current owner of the home who gets debt forgiveness in the place of a foreclosure and the financial institute who usually takes less of a loss financially. It also often works for the new home buyer as well because they get a home that is in nice shape often at or lower than foreclosure pricing.
It isn't easy though and there are two obstacles to short sales. One issue is time. Lending companies often take a long time to get things approved and buyers aren't always the most patient. As an broker, it is much easier for me to sell a banked owned home or a traditional seller owned home over a short sale.
The second concern is possible tax liability. In the event a lending institute authorizes debt forgiveness it is obligatged to report that debt forgiveness as income via IRS form 1099. What most of people won't research is the reality of their taxes.
Many people are classified as financially destitute and are thereby relieved of these tax burdens. Homeowners in this situation are smart to have a CPA review their net worth utilizing the proper IRS form and maybe pleasantly surprised.
Wrapping up, there is some good news on the horizon. The House of Representatives just nicely passed a recent bill to waive the IRS consequences on lien forgiven debt. This action further augments the upsides of a short sale over a foreclosure and seriously reducing the long term financial carnage for homeowners caught in what has become a very ordinary scenario. Stefan West is a area specialist of Murrieta and Temecula Homes and an expert in the adjacent areas. Please visit http: //www. stefanwest. com to read some additional articlesTopics related articles：

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