The somewhat long and frustrating process of short sales are sometimes a deterrent for specialists. However, the best part of short sale listings is that the process for sellers isn’t all that bad. Since the seller isn’t paying the real estate commission, they have less objection and can move forward with the process quickly.
Helping understand seller concerns can lead specialists to more listings. Short sale specialists should take these seller concerns into consideration:
- Financial benefits of a short sale
- Tax Implications of a short sale
- Impact of the short sale on the seller’s credit
Be prepared to deal with these concerns. Here are a few answers that can help you when the homeowner brings you these concerns:
“Will selling my home as a short sale benefit me?”
Lots of benefits of selling your home as a short sale exist. Some lenders may even offer relocation assistance money (sometimes up to $40,000) to certain short sellers. If you wait for your home to go into foreclosure, you may receive far less expenses for relocating.
“Will the short sale process impact my credit?”
Your credit will be impacted if you stopped making payments on your home. However, if you remain current on your mortgage during the short sale process, the US Treasury has some new positive credit reporting as part of the HAFA program. Also, if the bank forecloses on your home, that information will be on your credit report for five to seven years.
“Will I have to pay taxes on the amount of debt forgiven?”
Thankfully, the mortgage forgiveness act of 2007 provides some tax protection for certain short sale sellers. Please note, this act is set to expire as of December 31, 2012. Additional tax protections are available and should be discussed with your accountant.