Short Sales New FHA Guidelines for
Former Arizona Homeowner can now Buy Sooner
As a Short Sale Specialist in Arizona we know bad things happen to good people.
So don’t let your previous short sale paralyze you into thinking that you are not able to purchase a home again anytime soon. This means that potential home buyers in the Phoenix, Ahwatukee, Gilbert, Chandler & Mesa areas in Arizona who would like to take advantage of the low rates and buy a home in the Phoenix area should contact us today 480-239-5468 and we can put you in touch with a lender to find out if you qualify for the Back at Work Program FHA. This is your second chance and its important to start the process now and learn about all the new guidelines available.
If your thinking about a short sale in Phoenix, Ahwatukee, Gilbert, Chandler & Mesa areas in Arizona, now is the time to start the process.
The worst thing you can do is nothing, if your falling behind on your mortgage or facing a hardship. Not only are the new FHA rules, helping homeowners who have previously had a short sale or foreclosure.
These new rules are going to add a new group of buyers in the market, this may be the perfect opportunity to short sell your home and take advantage of all the new short sale guidelines. If you have had a short sale in past here is your chance to purchase a home again. There are some amazing homes on the market in Phoenix and surrounding areas.
A short sale is a sale of real estate in which the proceeds from selling the property will fall short of the balance of debts secured by liens against the property. In addition, the property owner cannot afford or chooses not to repay the liens full amounts.
Therefore, the lien holders agree to release their lien on the real estate and accept less than the amount owed on the debt. Any unpaid balance owed to the creditors is known as a deficiency.
Short sale agreements do not necessarily release borrowers from their obligations to repay any deficiencies of the loans, unless specifically agreed to between the parties. That is why finding the right short sale specialist is important.
Banks do not want to take assets back. With the amount of work it takes to foreclose and the losses incurred, it is easier to facilitate a short sale.
There may be tax consequences to a short sale but every situation is unique. Maybe you heard that you should not do a short sale or you will get taxed…
Does It Hurt My Credit?
Yes a short sale will have an impact on your credit. But so does the 30 day late, 60 day late & 90 day late missed payments. Most lenders will consider a 90 day late the same as a foreclosure status on your credit report.
Get Started Now
There may be tax consequences to a Short Sale but every situation is unique. You may have been told that you should not do a short sale because you will get a 1099 and have to pay taxes on the difference between what you owed on your property and what you sold it for. That might be true, but it is not the whole truth.
If you borrow money from a bank and the bank cancels or forgives your debt, you might have to include the cancelled amount in income for tax purposes, depending on your personal situation. When you borrowed the money you weren’t required to include the loan proceeds as income because you were obligated to repay the lender.
When a obligation to repay is forgiven, the amount you received from your loan is normally reported as income because you don’t have an obligation to repay the lender. The lender is typically required to report the amount of that canceled debt to you and to the IRS on a Form 1099-C, Cancellation of Debt.
The thing that most people won’t tell you is that with a Foreclosure, you will also get a 1099. With a Foreclosure the 1099 is called a “1099-A” and the ‘A’ stands for “Acquisition or Abandonment of Secured Property”. It is critical to understand that while there are a number of differences, the tax consequences for the ‘C’ and the ‘A’ are the same. Because of The Mortgage Debt Relief Act of 2007 you may not even be required to pay taxes on the ‘income’ as shown on the 1099-C. However, don’t assume that you don’t have to pay these taxes. While we are very good at successfully closing Short Sales, we are not tax experts.
Before making your final decision, we always suggest that you first consult a CPA or Tax Preparer.
You may also want to check out some information regarding The Mortgage Debt Relief Act of 2007. It provides relief to many, many homeowners. For more information on the Mortgage Debt Relief Act, how it works, who it applies to, and more, please read more directly from the IRS website. Read The Mortgage Debt Relief Act of 2007.