Has the Tax Foregiveness Act been extended yet for Short Sales?

Question

Now that California has a new law that protects the Homeowned from the Banks coming after them for the $ difference created by a Short Sale, we should be seeing more Homeowners willing to do Short Sales. Or is anyone seeing the Banks less likely to Approve Short Sales knowing they now can not go after Sellers for the short fall?

Answer 1

Dear Mr. Vanderploeg,

THe new law hasbeen creating issues with getting transactions closed and some have been rejected by the second lien holders thus allowing them to preserve their rights to pursue repayment after the first forecloses should the seller not file for BK...if the seller does not file for BK after the first forecloses and they have a recourse second then they could have a judgement placed on them for the amount owed on the second the only way to wipe it out completely is to get a settlement in a Short Sale or allow the first lien holder to foreclose and then file BK but since I am only a REALTOR I would suggest you seek the opinion of a Real Estate Attorney should you have specific questions about this issue. (If you need a referral I would be happy to give you one...in the state of California as a REALTOR I am not allowed to give legal or tax advise)

I hope this helps,

Michale Tessaro

myeastbayhouses@gmail.com

Answer 2

I see less short sales being foreclosed on compared to when short sales first started, to date we've received written approval on everything.  Things in the short sale arena change daily so stay updated!

Answer 3

In the Florida market where there were and are a lot of homeowners under water on their loans, I am seeing that the banks are actually rather short sale than to modify the current owner. Since in Florida that law has not passed yet, the banks are still moving forward on short sales and foreclosures as normal. With the new system with certain banks approving a short sale that can transfer to the next buyer if first falls off, the new Short Track system from Sunbelt, and Equator it is actually getting easier.... Stay tuned or feel free to find more info at Damonpenn.com