Short Sale VS. Forcloser ..............What is the best choice?

By
Mortgage and Lending with Lee Parrish
A growing question I get from people that just do not have any choice in getting out of thier mortgage situation is which is better. I am not a tax expert nor claim to be.....I wanted to get some insight as how everyone on the site feels as I want to do a true comparison of what the masses thinks on this subject. Please leave a message so this can be an accurate POLL so to speak.

Comments (5)

Brian Hoots
Real Living Speckman Realty, Inc. - Bourbonnais, IL

Lee , great question I will be watching I would like to see what others have to say also.

Oct 02, 2007 04:16 PM
Anonymous
Michael Spickes with America's Home Rescue

Lee,

I appreciate the fact that you are humble enough to throw the question out there verses trying to come up with some off-the-wall answer for folks facing foreclosure.  Here's the bottom line.  Our company has done a lot of research into this issue and here is what we've uncovered.  Short Sale, in most cases, will cost a homeowner 80-100 points on their credit and the majority of the points deducted are for the 30, 60, and 90-day late payments.  On the other hand, a foreclosure typically reduces the homeowners credit by 250-280 points.  A foreclosure on someones record is absolutely devastating.  Even if the homeowner does a short sale and has additional concerns about the bank send them a 1099C (Cancellation of Debt), the IRS will almost always heavily discount or completely waive any potential tax liability caused by the lender taking a hit on the mortgage.  In the end, the net effect is fairly negligible.  Does this help?

Michael Spickes

America's Home Rescue

www.ShortSaleSolutions.biz

Short Sale Education and Resources for Real Estate Agents

Oct 02, 2007 05:03 PM
#2
Danny Thornton
R & D Art - Knoxville, TN
WordPress Guru
Lee, I have to agree with Michael in the assessment above. Taking a foreclosure on your credit is not only damaging now, it can affect you for the next 7 to 10 years. I have always advised the short sale when asked.
Oct 03, 2007 01:58 AM
David Resendes
Infinity Business Affiliates, INC - Naples, FL
Oct 10, 2007 06:10 AM
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Law Offices Of Lynn Ramey - Tampa, FL

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Jun 13, 2008 06:29 AM