Short Sales - Fresno Bankruptcy

For people who can no longer afford to make their mortgage payments, but who want to avoid having a foreclosure on their credit report, a short sale may be the best overall solution to the situation. A short sale allows you to sell your home for less than you currently owe, and avoid having the negative impact of a foreclosure on your credit report. In order to take advantage of a short sale, you will need the cooperation of your mortgage lender, and the ability to find a buyer at short notice. This is because short sales are typically only accepted when the lender is already in the process of moving forward on the foreclosure proceedings.

Short sales are best geared towards individuals who live in an area where the housing market still has a reasonable supply of buyers who are in the market for a new home. Additionally, short sales are often best for individuals whose home is in an area where home values are relatively steady. If your home's value has fallen sharply and you are "upside down" on your mortgage, it may be more difficult for you to come to a short sale agreement with the lender, depending upon your particular situation.

Short sales have several benefits:

·         Avoid foreclosure

·         Forgiveness of any remaining balance

·         Elimination of mortgage liability

However, there are also potential downsides to short sales. The main one of these is the forgiveness tax that may apply when the lender forgives the remainder of any principal that you owe after the house is sold. The IRS generally considers this type of lender forgiveness as income rather than as a debt that does not have to be repaid. This means that you may owe more in federal taxes, or even be moved to a higher tax bracket based upon how much you still owe on the mortgage loan when the balance is forgiven and the short sale is completed.

Speaking with a trained Fresno County Bankruptcy Attorney can help you to weigh the pros and cons of any short sale agreement. You may be able to save more, financially, with a Chapter 13 bankruptcy versus a short sale agreement, but it will depend upon your unique circumstances. What you don't know could cost you in the long run, so it pays to seek the advice of a qualified, reliable Fresno County Bankruptcy Lawyer before you reach any final agreements. Our firm offers a no-risk, free initial case evaluation that can help you to put your situation into perspective. Contact us today and let one of our seasoned professionals help you decide if a short sale is right in your situation.