Mortgage Forgiveness Debt Relief On The Fast Track
Someone lit a fire under Rep. Charles "Charlie" Rangel, which is good news for the San Diego real estate market in general, and many homeowners trying to determine the lesser of two evils, foreclosure or a short sale and the tax liability which goes with it.
Short Sale Overview Short-circuited by Realtor Trade Group
The other day I wrote a post about a short sale as a viable solution. The subject has been bandied about as an alternate solution for a homeowner who may be faced with losing the home to foreclosure. It has become the agent listing tool de jour. However, it is complicated and there are tax and legal issues that go beyond the scope of what most agents are qualified to address with most potential short sale candidates.
I view myself as a problem solver, negotiator, and marketing expert, then as a real estate sales person. My logic is simple. I believe that when buying or selling real estate, you need access to as much factual information as possible in order to make an intelligent decision, or rather, the best decision possible for that particular situation. Given that mindset, I set out to provide an unbiased, intelligent overview of the issues surrounding short sales.
I did some homework and found an excellent piece written by the legal eagles at the California Association of Realtors (CAR). I prefaced the post with this:
Short Sale Tax Relief Introduced in Congress
Rep. Charles "Charlie" Rangel , Democrat from New York and Chairman of the House Ways and Means Committee, today introduced H.R. 3648 to amend the Internal Revenue Code of 1986 to exclude discharges of indebtedness on principal residences from gross income, and for other purposes.
Short Sales - A Viable Solution?
A frequently heard definition of a short sale goes something like this:
"A short sale occurs when the lender agrees to take less than the full amount required to pay off existing loans in full because the outstanding loan balance is greater than the proceeds realized from the sale of the property."
Like many things in life, simple definitions and answers for complicated issues and questions are not always the best. This is particularly true with issues that involve legal documents, monetary investments and the IRS. Therefore, instead of posturing with my own opinions, I have requested permission to reprint a legal article from the California Department of Real Estate (C.A.R.) that addresses many issues with regard to short sales, deficiency judgments, trustee sales, deed in lieu of foreclosure, and judicial vs non-judicial foreclosures.
In the meantime, I will post the questions addressed in the article.
Is A Virtual Tour Right For Your Property?
I get asked all the time, "Bob, what advertising works best?"
Fsbo sellers want to know what works that doesn’t cost anything, sellers want to know how their listings will be advertised regardless of effectiveness, agents want to know what they should stop wasting their money on, and brokers want to offload the entire issue on agents.
My answer is always the same, regardless of whether we’re talking about the San Diego real estate market or Middle America.
Congress Looking To Change Short Sale Tax Implications
The Bush White House endorsed two new bipartisan bills aimed at eliminating the 1099C lenders are required by law to issue to sellers who "benefit" from debt relief realized with a short sale. The current tax code treats this debt relief as earned income. With the proposed legislative changes to the tax code, sellers would be off the hook for this increased tax burden.
