Short sale and pre-foreclosure strategy. What might your objectives be and how should you accomplish those goals?
For most upside down homeowners the threshold question is - keep the home or let it go. Lately the large majority are saying let it go. Many homeowner in San Diego and Florida are facing impossible arm payments. Clients are telling me their arms are exploding and in the next few months their payments are going form $3,000 to $14,000 a month. Not many people wish to make impossible payments on a home which has lost $100,000 in equity since their purchase. .
Others just have no desire to spend their entire pay check on the mortgage when their homes are going down in value.
Its interesting a few months ago, many of the people I spoke with wanted to keep their home. Lately not one of my clients or potential clients has said they wanted to keep their property.
So that is where our inquiry begins. In consultation with our clients and either the Realtors on our team or the clients Realtor we usually design a strategy with the following goal:
1. Avoid or minimize deficiency.
2. Avoid or minimize tax liability.
3. Avoid or minimize damage to credit.
In the next post we will discuss our non proprietary strategies designed to avoid a minimize deficiency. We will also discuss how a short sale can help achieve that goal if the proper legal agreements are drafted. I will also post an excellent question that two of my recent clients asked about the affect of short sale vs allowing a foreclosure when you have non recourse loans. When a appropriate I will explain the difference between our pre foreclosure strategies for California homeowners and pre foreclosure strategies for Florida homeowners.
San Diego Short Sales San Diego Real Estate Attorney
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3. Avoid or minimize damage to credit. This is the only one I care about, since it has the longest term of consequences.