Short Sale

Neutron · #1 (**permalink**) 10-04-2009, 12:59 PM

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Has anyone gone through the short sale process?

Van · #2 (**permalink**) 10-05-2009, 01:50 PM

Someone did thats in the pub up in PA and its not BH, they did it a year ago on some property that their father owned but I can't remember who it was thought it might have been the same person who took the auto train from Florida if I remember correctly.

navychop · #3 (**permalink**) 10-05-2009, 04:16 PM

But not this guy who took the auto train.

Only instance I know of a short sale is it fell thru at the last moment.

BTW, of possible interest to others: I bought a townhouse at VA "auction" quite successfully. After the deal was done, we discovered (home inspection) that the roof was that defective fire retardant stuff. Demanded VA replace the roof. No problem, they did that and something else IIRC, paid for it all promptly. And I got a repo at a good (not great) price. In a previous round of "auction" they declined all offers and held out for more money, via a separate "auction."

Neutron · #4 (**permalink**) 10-05-2009, 07:58 PM

What I find odd is I talked with GMAC mortgage today and was told that BECAUSE we are current on our mortgage they will not do a loan modification (short refi/payoff) to bring our mortgage in line with the actual house value. They said our only option is a short sale. WTF?

They said we would have to be behind 3-4 months in order to possibly qualify for a loan modification. What a crock.

navychop · #5 (**permalink**) 10-05-2009, 08:06 PM

Yep.

Neutron · #6 (**permalink**) 10-05-2009, 08:23 PM

What's the incentive when I can short sell it, pay the credit penalty for 1-2 years, and get a new mortgage. At the rate my house value is compared to our mortgage value, it will take 10 years to recover.

bhelms · #7 (**permalink**) 10-06-2009, 01:11 PM

Not this "BH" from PA who took the Autotrain either...!

Don't forget additional downsides of short sales: The lender might not completely forgive the balance owed which might put other assets in jeopardy, any other lien holders like a property taxing authority still have to be satisfied, and if the short sale is indeed accepted as settlement in part or full by the lenders the price differential may be taxable income for the original mortgagee...

Tax Consequences of Foreclosure, Short Sale and Deed in Lieu of Foreclosure
A Short Sale To Avoid Foreclosure May Have Pitfalls