Are there any fees if you negotiate my short sale?
There are absolutely no costs to you whatsoever. If the bank approves the short sale then we will buy your property and set you free from the burden.

When should I start working with you on my short sale?
If you feel that you can no longer afford to pay your monthly mortgage payment, or if you are already late on your payment, then you should get started immediately. The more time that we have to negotiate with the bank, the greater our chance of a successful transaction.

Why would my lender do a short sale?
Your lender is motivated to do a short sale because they will save time and money in the long run. If your property ends up going into foreclosure, they will incur many expenses which can be avoided if they negotiate a successful short sale. Also, having foreclosed properties in their inventory prevents the bank from making loans. We will explain this during our consultation with you.

How long does it take for a short sale to complete?
Each bank is different but it typically takes between 2 and 4 months to complete. Some short sales may take longer. We are able to delay the foreclosure while we are negotiating the short sale.

Can I receive any type of payment back from the transaction?
No. It is against the law in California for any member of the household or an extended family member to receive gain from a short sale. The bank is accepting a loss, so therefore it would be considered loan fraud if the borrower received any money back. However, we may be able to assist with some of your moving costs. 

What impact does a short sale and a foreclosure have on my credit?
A foreclosure will show up on your credit file as a foreclosure and can stay on record for 7 to 10 years, making it very difficult to get another home loan, car loan, credit card, etc. Sometimes it is viewed as seriously as a bankruptcy. You will also often be required to disclose that information when applying for a job or renting property. On the other hand, a short sale is usually listed as debt settled for less than full balance, or a variation on that. This is typically much less harmful to your credit than a foreclosure. We advise you to consult a professional credit consultant to see how this would affect you.

Will I have a tax liability when doing a short sale on my primary residence?
In most cases, this may be avoided, but we advise you to consult with a real estate attorney and/or tax accountant. In December 2007 the government instituted the Mortgage Forgiveness Debt Relief Act which allows homeowners who use the property as their principal residence to generally not have any tax liability. There are some exceptions if you have done a Cash Out refinance on that property and did not use the funds to improve the property. An important thing to remember is that if you do have some potential tax liability, that liability will probably be worse if the property goes into foreclosure because the bank will lose more money. Many people make this mistake and think that if they let the property go into foreclosure, they are released of all liability. This is incorrect. We advise you to consult with a real estate attorney and/or tax accountant to determine your potential tax liability. You can read more about the Mortgage Forgiveness Debt Relief Act on the IRS website.  You can also find out more information by clicking 1099C. California also has Debt Forgivness Laws.

Will I have a tax liability when doing a short sale on a rental property or second home?
If you do a short sale on a rental property or second home, most homeowners will qualify for exclusions on tax liability through the “insolvency exclusion”. This actually holds true for your primary residence as well. What this basically says is that if immediately before the cancellation of debt (when you sold the property) your total liabilities exceed your total assets, you would be insolvent at that time by the amount that your liabilities exceed your assets. In short, if your property is woth less than what you owe and/or your income is less than your expenses, you are insolvent. You can read more here about the insolvency exclusion and see if it applies to you. We advise you to consult with a real estate attorney and/or tax accountant to determine your potential tax liability.

If you negotiate my short sale, is there a guarantee that it will be successful?
No. In order to be successful, the bank must agree to the terms, so there is no guarantee that the negotiation will result in a successful close of the transaction. Banks are agreeing to many more short sales in this current economic climate and you have nothing to lose by trying. Letting your house go to foreclosure is a much more devastating alternative.

If I begin the Short Sale, does it stop the collection process by the bank or lender?
No. We are only presenting an offer and the bank still has the legal right to collect the balance from the client. We have found though that if you get a collection call you can inform them that you are in the middle of a Short Sale and sometimes the calls will diminish, but it’s not always the case. You may also refer the calls to us.

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