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I was a little distracted over the very difficult listing appointment I had just come from. How did they get me to cut my commission. $5.37. That's what the kid behind the counter at Taco Bell said to me. I dug into my pocket and pulled out some lint and two dimes and something that used to be a Jolly Rancher. Having already handed the kid a five-spot, I started to head back out to the truck to grab some change when the kid with the Emo hairdo said the harshest thing anyone has ever said to me. He said, "It's OK. I'll just give you the senior citizen discount." I turned to see who he was talking to and then heard the sound of change hitting the counter in front of me. "Only $4.68" he said cheerfully. I stood there stupefied. I am 41, not even 50 yet much less 55 or 65? A mere child! Senior citizen? I took my burrito and walked out to the truck wondering what was wrong with Emo. Was he blind? As I sat in the truck, my blood began to boil. Old? Me? I'll show him, I thought. I opened the door and headed back inside. I strode to the counter, and there he was waiting with a smile. Before I could say a word, he held up something and jingled it in front of me, like I could be that easily distracted! What am I now? A toddler? "Dude! Can't get too far without your car keys, eh?" I stared with utter disdain at the keys. I began to rationalize in my mind. "Leaving keys behind hardly makes a man elderly! It could happen to anyone!" I turned and headed back to the truck. I slipped the key into the ignition, but it wouldn't turn. What now? I checked my keys and tried another. Still nothing. That's when I noticed the purple beads hanging from my rearview mirror. I had no purple beads hanging from my rearview mirror. Then, a few other objects came into focus. The car seat in the back seat. Happy Meal toys spread all over the floorboard. A partially eaten doughnut on the dashboard. Faster than you can say ginkgo biloba, I flew out of the alien vehicle. Moments later I was speeding out of the parking lot, relieved to finally be leaving this nightmarish stop in my life. That is when I felt it, deep in the bowels of my stomach: hunger! My stomach growled and churned, and I reached to grab my burrito, only it was nowhere to be found. I swung the truck around, gathered my courage, and strode back into the restaurant one final time. There Emo stood, draped in youth and black nail polish. All I could think was, "What is the world coming to?" All I could say was, "Did I leave my food and drink in here?" At this point I was ready to ask a Boy Scout to help me back to my vehicle, and then go straight home and apply for Social Security benefits. Emo had no clue. I walked back out to the truck, and suddenly a young lad came up and tugged on my jeans to get my attention. He was holding up a drink and a bag. His mother explained, "I think you left this in my truck by mistake." I took the food and drink from the little boy and sheepishly apologized. She offered these kind words: "It's OK. My grandfather does stuff like this all the time." All of this is to explain how I got a ticket doing 85 in a 40. Yes, I was racing some punk kid in a Toyota Prius.. And no, I told the officer, I'm not too old to be driving this fast. As I walked in the front door, my wife met me halfway down the hall. I handed her a bag of cold food and a $300 speeding ticket. I promptly sat in my rocking chair and covered up my legs with a blanky. The good news was I had successfully found my way home. -*-*-*-*-*-*-*-*-*-*-*-*-*-*-*-*-*-*-*- READ BELOW ! Just in case you weren't feeling too old today. The people who are starting college this fall were born in 1991. They are too young to remember the space shuttle blowing up. Their lifetime has always included AIDS. The CD was introduced two years before they were born. They have always had an answering machine. They have always had cable.. Popcorn has always been microwaved. They never took a swim and thought about Jaws. They don't know who Mork was or where he was from. They never heard: 'Where's the Beef?', 'I'd walk a mile for a Camel ', or 'de plane Boss, de plane'. McDonald's never came in Styrofoam containers. They don't have a clue how to use a typewriter.

"Requires a creditor, a mortgage servicer, or an agent of a creditor to acknowledge a written offer made in connection with a proposed short sale of property that is subject to a mortgage transaction that is at least 60 days delinquent. Provides that the acknowledgment must be provided not later than 10 business days after the date of the offer. Requires the creditor, servicer, or agent to accept or reject the short sale offer not later than 30 business days after receipt of the offer." Sounds great for all us Short Sale Realtors in Indiana. What will it mean, will it help. What we are finding is that most lenders especially the large ones just ignore the Bill and its terms. Or they simply quickly reject the offer.

An Act To amend the Internal Revenue Code of 1986 to exclude discharges of indebtedness on principal residences from gross income, and for other purposes.Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled , SECTION 1. SHORT TITLE. This Act may be cited as the ‘‘Mortgage Forgiveness Debt Relief Act of 2007’’.SEC. 2. DISCHARGES OF INDEBTEDNESS ON PRINCIPAL RESIDENCE EXCLUDED FROM GROSS INCOME. (a) I Revenue Code of 1986 is amended by striking ‘‘or’’ at the end of subparagraph (C), by striking the period at the end of subparagraph (D) and inserting ‘‘, or’’, and by inserting after subparagraph (D) the following new subparagraph: ‘‘(E) the indebtedness discharged is qualified principal residence indebtedness which is discharged before January 1, 2010.’’. (b) S N GENERAL.—Paragraph (1) of section 108(a) of the InternalPECIAL RULES RELATING TO QUALIFIED PRINCIPAL RESIDENCE I adding at the end the following new subsection: ‘‘(h) S NDEBTEDNESS.—Section 108 of such Code is amended byPECIAL RULES RELATING TO QUALIFIED PRINCIPAL RESIDENCE I ‘‘(1) B income by reason of subsection (a)(1)(E) shall be applied to reduce (but not below zero) the basis of the principal residence of the taxpayer. ‘‘(2) Q purposes of this section, the term ‘qualified principal residence indebtedness’ means acquisition indebtedness (within the meaning of section 163(h)(3)(B), applied by substituting ‘$2,000,000 ($1,000,000’ for ‘$1,000,000 ($500,000’ in clause (ii) thereof) with respect to the principal residence of the taxpayer. ‘‘(3) E TAXPAYER not apply to the discharge of a loan if the discharge is on account of services performed for the lender or any other factor not directly related to a decline in the value of the residence or to the financial condition of the taxpayer. ‘‘(4) O or in part, and only a portion of such loan is qualified principal residence indebtedness, subsection (a)(1)(E) shall apply only to so much of the amount discharged as exceeds the amount H. R. 3648—2 of the loan (as determined immediately before such discharge) which is not qualified principal residence indebtedness. ‘‘(5) P the term ‘principal residence’ has the same meaning as when used in section 121.’’. (c) C (1) Subparagraph (A) of section 108(a)(2) of such Code is amended by striking ‘‘and (D)’’ and inserting ‘‘(D), and (E)’’. (2) Paragraph (2) of section 108(a) of such Code is amended by adding at the end the following new subparagraph: ‘‘(C) P OVER INSOLVENCY EXCLUSION UNLESS ELECTED OTHERWISE to which paragraph (1)(E) applies unless the taxpayer elects to apply paragraph (1)(B) in lieu of paragraph (1)(E).’’. (d) E shall apply to discharges of indebtedness on or after January 1, 2007. NDEBTEDNESS.—ASIS REDUCTION.—The amount excluded from grossUALIFIED PRINCIPAL RESIDENCE INDEBTEDNESS.—ForXCEPTION FOR CERTAIN DISCHARGES NOT RELATED TO’S FINANCIAL CONDITION.—Subsection (a)(1)(E) shallRDERING RULE.—If any loan is discharged, in wholeRINCIPAL RESIDENCE.—For purposes of this subsection,OORDINATION.—RINCIPAL RESIDENCE EXCLUSION TAKES PRECEDENCE.—Paragraph (1)(B) shall not apply to a dischargeFFECTIVE DATE.—The amendments made by this section SEC. 3. EXTENSION OF TREATMENT OF MORTGAGE INSURANCE PREMIUMS AS INTEREST. (a) I the Internal Revenue Code of 1986 (relating to termination) is amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 31, 2010’’. (b) E shall apply to amounts paid or accrued after December 31, 2007. N GENERAL.—Subclause (I) of section 163(h)(3)(E)(iv) ofFFECTIVE DATE.—The amendment made by this section SEC. 4. ALTERNATIVE TESTS FOR QUALIFYING AS COOPERATIVE HOUSING CORPORATION. (a) I Internal Revenue Code of 1986 (defining cooperative housing corporation) is amended to read as follows: ‘‘(D) meeting 1 or more of the following requirements for the taxable year in which the taxes and interest described in subsection (a) are paid or incurred: ‘‘(i) 80 percent or more of the corporation’s gross income for such taxable year is derived from tenant- stockholders. ‘‘(ii) At all times during such taxable year, 80 percent or more of the total square footage of the corporation’s property is used or available for use by the tenant-stockholders for residential purposes or purposes ancillary to such residential use. ‘‘(iii) 90 percent or more of the expenditures of the corporation paid or incurred during such taxable year are paid or incurred for the acquisition, construction, management, maintenance, or care of the corporation’s property for the benefit of the tenant-stockholders.’’. (b) E shall apply to taxable years ending after the date of the enactment of this Act. H. R. 3648—3 N GENERAL.—Subparagraph (D) of section 216(b)(1) of theFFECTIVE DATE.—The amendment made by this section SEC. 5. EXCLUSION FROM INCOME FOR BENEFITS PROVIDED TO VOLUNTEER FIREFIGHTERS AND EMERGENCY MEDICAL RESPONDERS. (a) I the Internal Revenue Code of 1986 (relating to items specifically excluded from gross income) is amended by inserting after section 139A the following new section: N GENERAL.—Part III of subchapter B of chapter 1 of ‘‘SEC. 139B. BENEFITS PROVIDED TO VOLUNTEER FIREFIGHTERS AND EMERGENCY MEDICAL RESPONDERS. ‘‘(a) I volunteer emergency response organization, gross income shall not include— ‘‘(1) any qualified State and local tax benefit, and ‘‘(2) any qualified payment. ‘‘(b) D of a qualified volunteer emergency response organization— ‘‘(1) the deduction under 164 shall be determined with regard to any qualified State and local tax benefit, and ‘‘(2) expenses paid or incurred by the taxpayer in connection with the performance of services as such a member shall be taken into account under section 170 only to the extent such expenses exceed the amount of any qualified payment excluded from gross income under subsection (a). ‘‘(c) D ‘‘(1) Q ‘qualified state and local tax benefit’ means any reduction or rebate of a tax described in paragraph (1), (2), or (3) of section 164(a) provided by a State or political division thereof on account of services performed as a member of a qualified volunteer emergency response organization. ‘‘(2) Q ‘‘(A) I any payment (whether reimbursement or otherwise) provided by a State or political division thereof on account of the performance of services as a member of a qualified volunteer emergency response organization. ‘‘(B) A determined under subparagraph (A) for any taxable year shall not exceed $30 multiplied by the number of months during such year that the taxpayer performs such services. ‘‘(3) Q ORGANIZATION response organization’ means any volunteer organization— ‘‘(A) which is organized and operated to provide firefighting or emergency medical services for persons in the State or political subdivision, as the case may be, and ‘‘(B) which is required (by written agreement) by the State or political subdivision to furnish firefighting or emergency medical services in such State or political subdivision. ‘‘(d) T to taxable years beginning after December 31, 2010.’’. H. R. 3648—4 (b) C is amended by inserting after the item relating to section 139A the following new item: N GENERAL.—In the case of any member of a qualifiedENIAL OF DOUBLE BENEFITS.—In the case of any memberEFINITIONS.—For purposes of this section—UALIFIED STATE AND LOCAL TAX BENEFIT.—The termUALIFIED PAYMENT.—N GENERAL.—The term ‘qualified payment’ meansPPLICABLE DOLLAR LIMITATION.—The amountUALIFIED VOLUNTEER EMERGENCY RESPONSE.—The term ‘qualified volunteer emergencyERMINATION.—This section shall not apply with respectLERICAL AMENDMENT.—The table of sections for such part ‘‘Sec. 139B. Benefits provided to volunteer firefighters and emergency medical responders.’’. (c) E shall apply to taxable years beginning after December 31, 2007. FFECTIVE DATE.—The amendments made by this section SEC. 6. CLARIFICATION OF STUDENT HOUSING ELIGIBLE FOR LOW- INCOME HOUSING CREDIT. (a) I Internal Revenue Code of 1986 (relating to certain students not to disqualify unit) is amended to read as follows: ‘‘(I) single parents and their children and such parents are not dependents (as defined in section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof) of another individual and such children are not dependents (as so defined) of another individual other than a parent of such children, or.’’. (b) E shall apply to— (1) housing credit amounts allocated before, on, or after the date of the enactment of this Act, and (2) buildings placed in service before, on, or after such date to the extent paragraph (1) of section 42(h) of the Internal Revenue Code of 1986 does not apply to any building by reason of paragraph (4) thereof. N GENERAL.—Subclause (I) of section 42(i)(3)(D)(ii) of theFFECTIVE DATE.—The amendment made by this section SEC. 7. APPLICATION OF JOINT RETURN LIMITATION FOR CAPITAL GAINS EXCLUSION TO CERTAIN POST-MARRIAGE SALES OF PRINCIPAL RESIDENCES BY SURVIVING SPOUSES. (a) S of the Internal Revenue Code of 1986 (relating to limitations) is amended by adding at the end the following new paragraph: ‘‘(4) S SPOUSES an unmarried individual whose spouse is deceased on the date of such sale, paragraph (1) shall be applied by substituting ‘$500,000’ for ‘$250,000’ if such sale occurs not later than 2 years after the date of death of such spouse and the requirements of paragraph (2)(A) were met immediately before such date of death.’’. (b) E shall apply to sales or exchanges after December 31, 2007. ALE WITHIN 2 YEARS OF SPOUSE’S DEATH.—Section 121(b)PECIAL RULE FOR CERTAIN SALES BY SURVIVING.—In the case of a sale or exchange of property byFFECTIVE DATE.—The amendment made by this section SEC. 8. MODIFICATION OF PENALTY FOR FAILURE TO FILE PARTNERSHIP RETURNS; LIMITATION ON DISCLOSURE. (a) E Internal Revenue Code of 1986 (relating to failure to file partnership returns) is amended by striking ‘‘5 months’’ and inserting ‘‘12 months’’. (b) I 6698(b) of such Code is amended by striking ‘‘$50’’ and inserting ‘‘$85’’. H. R. 3648—5 (c) L S C XTENSION OF TIME LIMITATION.—Section 6698(a) of theNCREASE IN PENALTY AMOUNT.—Paragraph (1) of sectionIMITATION ON DISCLOSURE OF TAXPAYER RETURNS TO PARTNERS,ORPORATION SHAREHOLDERS, TRUST BENEFICIARIES, AND E (1) I to disclosure to persons having material interest) is amended by adding at the end the following new paragraph: ‘‘(10) L —In the case of an inspection or disclosure under this subsection relating to the return of a partnership, S corporation, trust, or an estate, the information inspected or disclosed shall not include any supporting schedule, attachment, or list which includes the taxpayer identity information of a person other than the entity making the return or the person conducting the inspection or to whom the disclosure is made.’’. (2) E shall take effect on the date of the enactment of this Act. (d) E (a) and (b) shall apply to returns required to be filed after the date of the enactment of this Act. STATE BENEFICIARIES.—N GENERAL.—Section 6103(e) of such Code (relatingIMITATION ON CERTAIN DISCLOSURES UNDER THIS SUBSECTION.FFECTIVE DATE.—The amendment made by this subsectionFFECTIVE DATE.—The amendments made by subsections SEC. 9. PENALTY FOR FAILURE TO FILE S CORPORATION RETURNS. (a) I the Internal Revenue Code of 1986 (relating to assessable penalties) is amended by adding at the end the following new section: N GENERAL.—Part I of subchapter B of chapter 68 of ‘‘SEC. 6699. FAILURE TO FILE S CORPORATION RETURN. ‘‘(a) G section 7203 (relating to willful failure to file return, supply information, or pay tax), if any S corporation required to file a return under section 6037 for any taxable year— ‘‘(1) fails to file such return at the time prescribed therefor (determined with regard to any extension of time for filing), or ‘‘(2) files a return which fails to show the information required under section 6037, such S corporation shall be liable for a penalty determined under subsection (b) for each month (or fraction thereof) during which such failure continues (but not to exceed 12 months), unless it is shown that such failure is due to reasonable cause. ‘‘(b) A amount determined under this subsection for any month is the product of— ‘‘(1) $85, multiplied by ‘‘(2) the number of persons who were shareholders in the S corporation during any part of the taxable year. ‘‘(c) A (a) shall be assessed against the S corporation. ‘‘(d) D of chapter 63 (relating to deficiency procedures for income, estate, gift, and certain excise taxes) shall not apply in respect of the assessment or collection of any penalty imposed by subsection (a).’’. (b) C of subchapter B of chapter 68 of such Code is amended by adding at the end the following new item: ENERAL RULE.—In addition to the penalty imposed byMOUNT PER MONTH.—For purposes of subsection (a), theSSESSMENT OF PENALTY.—The penalty imposed by subsectionEFICIENCY PROCEDURES NOT TO APPLY.—Subchapter BLERICAL AMENDMENT.—The table of sections for part I ‘‘Sec. 6699. Failure to file S corporation return.’’. H. R. 3648—6 (c) E shall apply to returns required to be filed after the date of the enactment of this Act. FFECTIVE DATE.—The amendments made by this section SEC. 10. MODIFICATION OF REQUIRED INSTALLMENT OF CORPORATE ESTIMATED TAXES WITH RESPECT TO CERTAIN DATES. The percentage under subparagraph (B) of section 401(1) of the Tax Increase Prevention and Reconciliation Act of 2005 in effect on the date of the enactment of this Act is increased by 1.50 percentage points.Speaker of the House of Representatives. Vice President of the United States and President of the Senate.

Did you miss the fact that foreclosure filings were up 71% in the third quarter? Which makes it a good time to remind everyone of the rules that govern when and how you'll be eligible for a mortgage after you've been foreclosed, surrendered a deed, or negotiated a short sale. For borrowers with a foreclosure, short sale, or deed in lieu of foreclosure on their credit history, the following timelines apply before they'll be eligible for a conforming, conventional mortgage (Fannie Mae/Freddie Mac): •Foreclosure: 5 years from completion date, minimum 680 FICO and 10% down for 7 years, investment property, second homes, cash out refinances not allowed for 7 years. •Deed-in-Lieu of Foreclosure: 4 years, at least 10% down required for 7 years. •Short Sale: 2 years. 4 years for Freddie Mac For what it's worth, under FHA rules you have to wait two years before you are born-again. Goes without saying that if you do wind up with a foreclosure (or one of it's close cousins) on your record, unless you handle the period after the foreclosure properly by re-establishing credit - no easy trick with a serious derogatory on your record - and accumulating a sizeable down payment, you are likely to be renting for a long, long time. Or, another way to look at this: At some point in the next five years, buying may look really cheap, and you'll be locked out of the game.

A Quick Look - Judicial Foreclosure Available: Yes - Non-Judicial Foreclosure Available: No - Primary Security Instruments: Mortgage - Timeline: Typically 150 days - Right of Redemption: Yes - Deficiency Judgments Allowed: Yes In Indiana, lenders may foreclose on a mortgage in default by using the judicial foreclosure process. Judicial Foreclosure The judicial process of foreclosure, which involves filing a lawsuit to obtain a court order to foreclose, is used when no power of sale is present in the mortgage or deed of trust. Generally, after the court declares a foreclosure, the property will be auctioned off to the highest bidder. However, there is a wait time between the date the suit was filed and the day the property is sold. In Indiana, the date the mortgage was signed determines the length of time a lender must wait between filing the suit and proceeding with the foreclosure sale. The wait time is anywhere from three (3) to twelve (12) months, but the owner may file a waiver of the time limit, which allows the sale to proceed without delay. When this occurs, the lender loses the right to pursue a deficiency judgment. The foreclosure sale process involves publishing an ad once a week for three weeks. The first ad must be run 30 days before the sale. At the time the first ad is run, each owner must be served with notice of the foreclosure sale by the sheriff. The sheriff conveys title by a deed given immediately after the sale. The owner may reside in the property, rent free, until the foreclosure sale, provided the owner is not committing waste, which means tearing up the property. More information on Indiana foreclosure laws. Michael Mergell (317) 645-8717

A Certified Distressed Property Expert® is a real estate professional with specific understanding of the complex issues confronting the real estate industry, and the foreclosure avoidance options available to homeowners. Through comprehensive training and experience, CDPEs are able to provide solutions for homeowners facing hardships in today’s market, specifically short sales. The prospect of foreclosure can be financially and emotionally devastating, and often homeowners proceed without guidance of any kind. The developers of the CDPE Designation believe that the best course of action for a homeowner in distress is to speak with a well-informed, licensed real estate professional. They have the tools needed to help homeowners find the best solution for their situation. Often, when other options have been exhausted, CDPEs can help homeowners avoid foreclosure through the efficient execution of a short sale. While enduring financial difficulties is challenging for any family, the process of finding a qualified real estate professional should not be. Selecting an agent with the CDPE Designation ensures you are dealing with a professional trained to address your specific needs. For more information, contact a CDPE in your area.

A short sale in real estate is not always a pleasant transaction. There are many ways to lose a home but signing away ownership in a manner that destroys credit, embarrasses the family and strips an owner of dignity is one of the hardest. For owners who can no longer afford to keep mortgage payments current, there are alternatives to bankruptcy or foreclosure proceedings. One of those options is called a "short sale." More than half of my sales in Sacramento over the past few years are short sales. That's how prominent short sales have become. When lenders agree to do a short sale in real estate, it means the lender is accepting less than the total amount due. Not all lenders will accept short sales or discounted payoffs, especially if it would make more financial sense to foreclose; moreover, not all sellers nor all properties qualify for short sales. If you are considering buying a short sale, there could be drawbacks. For your protection, I suggest that all borrowers: •Obtain legal advice from a competent real estate lawyer •Call an accountant to discuss short sale tax ramifications As a real estate agent, I am not licensed as a lawyer nor a CPA and cannot advise on those consequences. Except for certain conditions pursuant to the Mortgage Forgiveness Debt Relief Act of 2007, be aware the I.R.S. could consider debt forgiveness as income, and there is no guarantee that a lender who accepts a short sale will not legally pursue a borrower for the difference between the amount owed and the amount paid. In some states, this amount is known as a deficiency. A lawyer can determine whether your loan qualifies for a deficiency judgment or claim. Although all lenders have varying requirements and may demand that a borrower submit a wide array of documentation, the following steps will give you a pretty good idea of what to expect. •Call the Lender You may need to make a half dozen phone calls before you find the person responsible for handling short sales. You do not want to talk to the "real estate short sale" or "work out" department, you want the supervisor's name, the name of the individual capable of making a decision. •Submit Letter of Authorization Lenders typically do not want to disclose any of your personal information without written authorization to do so. If you are working with a real estate agent, closing agent, title company or lawyer, you will receive better cooperation if you write a letter to the lender giving the lender permission to talk with those specific interested parties about your loan. The letter should include the following: •Property Address •Loan Reference Number •Your Name •The Date •Your Agent's Name & Contact Information •Preliminary Net Sheet This is an estimated closing statement that shows the sales price you expect to receive and all the costs of sale, unpaid loan balances, outstanding payments due and late fees, including real estate commissions, if any. Your closing agent or lawyer should be able to prepare this for you, if you do not know how to calculate any of these fees. If the bottom line shows cash to the seller, you will probably not need a short sale. •Hardship Letter The sadder, the better. This statement of facts describes how you got into this financial bind and makes a plea to the lender to accept less than full payment. Lenders are not inhumane and can understand if you lost your job, were hospitalized or a truck ran over your entire family, but lenders are not particularly empathetic to situations involving dishonesty or criminal behavior. •Proof of Income and Assets It is best to be truthful and honest about your financial situation and disclose assets. Lenders will want to know if you have savings accounts, money market accounts, stocks or bonds, negotiable instruments, cash or other real estate or anything of tangible value. Lenders are not in the charity business and often require assurance that the debtor cannot pay back any of the debt that it is forgiving. •Copies of Bank Statements If your bank statements reflect unaccountable deposits, large cash withdrawals or an unusual number of checks, it's probably a good idea to explain each of those line items to the lender. In addition, the lender might want you to account for each and every deposit so it can determine whether deposits will continue. •Comparative Market Analysis Sometimes markets decline and property values fall. If this is part of the reason that you cannot sell your home for enough to pay off the lender, this fact should be substantiated for the lender through a comparative market analysis (CMA). Your real estate agent can prepare a CMA for you, which will show prices of similar homes: •Active on the market •Pending sales •Solds from the past six months. •Purchase Agreement & Listing Agreement When you reach an agreement to sell with a prospective purchaser, the lender will want a copy of the offer, along with a copy of your listing agreement. Be prepared for the lender to renegotiate commissions and to refuse to pay for certain items such as home protection plans or termite inspections. Now, if everything goes well, the lender will approve your short sale. As part of the negotiation, you might ask that the lender not report adverse credit to the credit reporting agencies, but realize that the lender is under no obligation to accommodate this request. Credit report status is not always negotiable.

A short sale is a sale of real estate in which the sale proceeds fall short of the balance owed on the property's loan. It often occurs when a borrower cannot pay the mortgage loan on their property, but the lender decides that selling the property at a moderate loss is better than pressing the borrower. Both parties consent to the short sale process, because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrowers. This agreement, however, does not necessarily release the borrower from the obligation to pay the remaining balance of the loan, known as the deficiency.

Buying houses by means of a short sale can be a great way to make significant amounts of money, but they're not for everyone. You have to find a seller who will work with you to persuade the lender to sell the home rather than allowing the foreclosure process to continue. Then you have to submit an offer that's low enough to make a profit, yet not so low as to be rejected altogether. If a lender does reject your offer, all isn't lost. The first thing to do is to try to determine why your offer was rejected. There are many possible reasons, and if you want the sale to go through, you must job find out exactly what the lender wants in order to make the sale happen. Here are possible reasons. First, your offer may simply have been too low, which meant the lender would be taking too big of a hit by accepting it. They also may believe they can do better once the foreclosure has been completed, or since loans are often sold to investors, it's also possible that the holder of the note wouldn't accept the loss. Perhaps the borrower's financial difficulty wasn't stated strongly enough to make a persuasive case for a short sale. If that's the case, the lender might want to work out an alternative payment schedule with the homeowners rather than entering into a short sale. Since most lenders will require a broker's price opinion (BPO), make sure your offer is somewhere near that figure. Otherwise, a lender will be convinced that they can do better on the open market once the foreclosure is complete. There may be other reasons, but the number one reason short sale offers are rejected is simply because they're too low. After all, lenders are in business to make a profit, and even when appears there's no profit to be made in a particular home; they want to cut their losses as much as possible. So don't get greedy. You'll rarely be able to steal a home, but you can often get a substantially lower price than you would on the open market. One of the best ways to avoid coming in too low is simply to ask the lender how much they hope to net from a short sale. They may not tell you, but you'll never know if you don't ask. Even if you don't get an answer in the beginning, you'll have another chance to ask before they make a counteroffer. Be courteous, but emphasize that you're really hoping to make the sale happen. Again, you may be surprised by the figure you receive, and if it's acceptable, jump on it. Don't kill your sale by being too greedy. If your short sale offer is rejected, don't give up. Probe for more information about why your offer didn't fly and then try to satisfy whatever they ask for before making your counteroffer. You won't be stealing the home, but there's often plenty of profit to be made.