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Aliso Viejo Foreclosure-Who is giving this advice?

by keithwatts on March 9, 2012

in Latest News, Sellers, Short Sales

When Aliso Viejo Real Estate Real Estate turned south a few years back the term “Short Sale” was a new concept to people who were not real estate professionals. Now, five years later it’s rare to come across a buyer or seller who is not familiar with the term. I think it’s safe to say that everyone knows someone who has short sold a home if they haven’t done one themselves.

Troubled homeowner will not place the house for sale

With pre-foreclosure sales so prevalent in our current marketplace why is there still so much misinformation regarding the short sale and its advantages over a Foreclosure?  I recently met with a woman seeking a loan modification. She had been spending years grinding through the system doing her best to qualify for a modification. Sound familiar?

After all her efforts the loan modification failed and she had resigned herself to a foreclosure.  Everyone has heard this story thousands of times but what puzzles me was her belief that a short sale and a foreclosure have the same impact on your credit.  Someone had given her terrible advice.  Who told her not to short sale?  Why didn’t she want the home in the MLS as a short sale listing?

Friends and Family don’t want the house for sale

Actually I should say friends, family, co workers, people in line at the grocery store and everyone else seems to have an opinion about this matter but a distressed howeowner should not take advice from non professionals.  This is area in which information constantly changes and only a true professional can keep themselves, and you updated.

Loss Mitigation Department can’t advise on houses and homes for sale

I know this is a crazy idea.  Shouldn’t the “Bank” be giving me advice.  When a delinquent borrower calls the Loss Mitigation department for their loan servicer they are esentially calling a collection department.  This is a very complex and frustrating system because the customer service agents will not give you advice which conflicts with their ability to collect debt when in many cases that is exactly the advice a borrower needs.  They do not want to tell everyone that a short sale is “great way out” because it may lead to strategic default.

Lawyers may benefit when there is no Real Estate Agent

Not all lawyers, many are amazing.  In the past few years a lot of very bad lawyers have collected a lot of money from desperate people, doing there best to keep them away from Realtors which may provide a better long term option.  They collected lots of money with the promise of a loan modifications and many homeowners were told that a short sale and foreclosure were seen as equal on a credit report rather than explaining the long term differences.

The News loves to report bad news about short sale on houses

I have personally heard many news outlets reporting that a borrower which completes a short sale will owe the IRS income tax on the approved shortage.  There is currently information to the contrary posted on the IRS website.

Teaser Photo Attribution: By choffee’s photostream

Blog Photo Attribution: By Choffee’s photostream

 

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Post by Keith Watts

Keith has written 87 articles.



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