Alert - U.S. Government Loan Modification program appears to only postpone the enevitable for homeowners who may not be able to afford the new loan payments or whose home has lost substantial market value as compared to what may still be owed to pay off the mortgage debt. Owing more for your home than what the market conditions say the value of the home is results in some homeowners simply walking away from their home rather than keep trying to overcome high mortgage payments in the face of devastating unemployment conditions. For some, these circumstances are unbearable. Loan modifications seem only to provide false hope with no real remedy for the homeowner who genuinely is trying every way they know to survive a financial crisis apparently created by those in the financial arena.
New lender guidelines set to go into affect on April 5, 2010 offer some help where lenders appear to be unable to pursue deficiency judgements against homeowners deliquent on their home loan.
This system is said to expire in 2012. Will lenders try and approve more short sales between now and April 5, 2010? The answer remains to be seen.
What next.... we have first time home buyer tax credits, and now the new guidelines also provide for homeowners who engage in short sales of their property with local investors who openly disclose their intent to quickly resale the property for a profit. This can be a good thing. A quick sale by an investor who has negotiated a short sale on behalf of the homeowner can relieve the homeowner now of the mortgage debt, hopefully saving a better result for their credit score so they can purchase a new home with payments they can afford and a market value more in keeping with the new mortgage loan balance.
On primary residences where the homeowner has lived in the property for 5 of the last 8 years, and when they sell their home pursuant to a short sale, there is talk that they may also qualify for tax credits as well.
Summary: Find a professional who can guide you through pre-foreclosures and is willing to negotiate for you the best price from the bank. That way an investor will be able to buy the home thereby releasing a homeowner from further struggle beneath the debt of a mortgage balance higher than the market value of the property, not to mention the unbelieveable payment required each month just to stay afloat. Homeowners can avoid forclosure and resulting massive hits to their credit scores and often be relieved of any defiency judgements against them as well when they commit to getting information necesary to apply for a short sale from a local real estate professional. Be prepared to complete all the necessary paperwork to convince the lender you really are a under "extreme hardship" and deserve this relief.
Your local professional real estate agent can help. Talk is cheap unless they care too and are reasonably knowledgeable to help. Try and find someone who has a ready made list of investors that may be able to make an immediate offer on your property. Then talk it through from there. Consult tax professionals as well as real estate attorneys or other professionals you may believe necessary. There may or may not be tax consequences to you from the short sale, but at least the debt should be removed, hopefully without you incurring a deficiency judgement.Good luck to all who are in genuine need of help resolving this deeply rooted financial crisis. I hope this benefits you.
Jim Robinson
Broker/Owner
Advertising Alabama
P.S. We have investor relationships who have the ability to help. You decide what is best for you.
Call us at (256) 270-0966 for free info.
