I Am Short Selling. How Will This Affect My Credit?
I am doing a short sale. (the property is listed here under Washington sfh for sale). How exactly does this affect my credit?
I am doing a short sale. (the property is listed here under Washington sfh for sale). How exactly does this affect my credit?
Pinky,
Is this your home or are you buying it?
BAMZ
This is my home and I can't get rid of it!
You'll need to be a little bit clearer to get any real help here...are you saying you've got a WA State SFR for sale? On this website?
If so, and you'll get me some details of what you've got, maybe I can give you some help.
John Merchant
Tacoma WA
Many factors are considered when selling your home 'short' presumably to avoid it's loss at a forced, publis foreclosure sale.
Chances are, your credit is already damaged. Selling short will not repair already damaged credit.
It may, however, prevent additional damage if you are able to sell preforeclosure thus avoiding the forced sale.
Depending upon your financial health, including other assets, the mortgagee may ask you to contribute toward any deficiency... either in cash at closing, or by executing a promissory note.
Or, they may simply forgive the deficiency in which case they will issue an IRS form 1099 reflecting the amount of forgiven debt. The IRS views forgiven debt as income. This income may be subject to tax. That's something to consider.
The structuring of a short sale takes awhile... so it would be best to alert your mortgagee, determine if your situation will qualify for short sale relief, and set the wheels in motion.
I own a home that I have listed in TCI Realty in Kelso Washington. I have tried to sell it, and I am tired of making the payments. I am only about 45 days behind, but still, I do not want it anymore. I owe 129k, I have buyers that will pay 132, after closing costs and raltor fees the bank will get 124k.
What's it worth? The mortgagee will want to know it's confirmed, as-is, fair market value... and ascertain that it's been professionally marketed (properly priced and adequately exposed to the market).
Presuming that it's only worth the sales price, and if it's not your primary residence, and you have a solid employment history with a few bucks in the bank.. they'll probably agree to release their security interest to facilitate the sale... but hold to you the promissory note for the full amount due... and if you want to preserve your future creditworthiness you'll realize that the $5K is well worth it..
[ Edited by TheShortSalePro on Date 12/17/2003 ]
It appraised at 166k FMV is 142k. My buyers only qualify for 132k. My renters pay 1000, my mortgage is 1400. I do not want to refi and add any more cost to the loan. I have a great realtor, but I do not want to wait, and pay $400 on top of what my renters pay, every month while I wait for a buyer.
Sounds a bit confusing... Sorry.
The appraised value should be the fair market value. Why the difference? How old is the appraisal? Was the appraisal for the purposes of a refinance (most refi appraisals are biased anyway)?
You'll need your real estate broker or broker's agent friend to provide comps that support the sale price...
In my experience apprasials do come in higher than FMV. This I'm assuming is coming from the standpoint that any house has a range of FMV. Apprasials are on the high end but often as investors we sell on the low to middle end (for quickness of sale). Just my 2 cents.