Serious Thread: Anyone here ever done a short sale before?

[Uppsala9496]

Nice you got the waiver. Wouldn't be fun to have that hanging over you forever.

 

[Blackjack200]

No, Connecticut is a recourse state unfortunately. Most of the $12K was owed as a promissory note, while the rest was me losing what I had left in my escrow account.

Weird, type "recourse states" into google and see what pops up at the top. 😵

guess I should have been a bit more diligent. Anyway, I imagine you're aware that the IRS may come after you for the forgiven amount (as stupid as I think that is)? Or do I have that wrong too?

 

[NetWareHead]

The main issue condos had were many were supposed to be non-investor yet everyone had a friend of a friend that knew someone to allow them to buy one as an investment.

So many condos had every unit sold, but like 90% vacancy...it freaks many people out to be alone on their floor and many move to condos to enjoy the community aspect of things.

My old company built a ton of units which lead to businesses building a ton of businesses to cater to them. With 90% of that traffic not present many folded.

What do you mean condos are supposed to be non-investor?

 

[ultimatebob]

Weird, type "recourse states" into google and see what pops up at the top. 😵

guess I should have been a bit more diligent. Anyway, I imagine you're aware that the IRS may come after you for the forgiven amount (as stupid as I think that is)? Or do I have that wrong too?

No, there is a good chance that the IRS will come after me for the forgiven debt on next year's taxes. They used to forgive short sale debt relief during the "housing crisis", but seemingly not anymore.

 

[alkemyst]

Weird, type "recourse states" into google and see what pops up at the top. 😵

guess I should have been a bit more diligent. Anyway, I imagine you're aware that the IRS may come after you for the forgiven amount (as stupid as I think that is)? Or do I have that wrong too?

The key thing this was an investment/second home. The main list of recourse vs non-recourse has to do with primary residences.

For second homes/investment properties, there are a lot of variables.

The IRS very rarely goes after a deficiency if a 1099C was not filed...over $12k it's doubtful it will even blip their radar.

 

[alkemyst]

What do you mean condos are supposed to be non-investor?

Many condos built during the boom had COA agreements and other rules that stated all properties were to be bought as Primary residences for some and non-investment properties for many others.

There were many ways people got around this, many claimed second home or that they were going to sell their current Primary residence and move in full time.

That's how so many buildings had so many vacancies and with 90% of a building investor owned desirability went way down.

 

[Blackjack200]

The key thing this was an investment/second home. The main list of recourse vs non-recourse has to do with primary residences.

For second homes/investment properties, there are a lot of variables.

The IRS very rarely goes after a deficiency if a 1099C was not filed...over $12k it's doubtful it will even blip their radar.

Where did he say that? I missed it. I thought FHA loans were only for primary residences.

Also, I think his deficiency was $60k-$12k or $48k.

 

[Fanatical Meat]

I bought a short sale property and it was a pain in the balls until we switched to Citizens Bank

 

[Rakehellion]

My FICO score went down from 820 to 690 once the whole ordeal was finished, which isn't as bad as I thought it would./QUOTE]

Wow, that's pretty huge.

 

[alkemyst]

My FICO score went down from 820 to 690 once the whole ordeal was finished, which isn't as bad as I thought it would./QUOTE]

Wow, that's pretty huge.

A 690 is still a good credit score

 

[edro]

I just got out of a 3 month short sale debacle.
We put an offer in which they accepted, did inspections, got appraisal that matched our offer.
They took one month to tell us we needed to up our offer. We did.
They took another month to tell us that they denied our offer.
They now re-listed the property for 150k more than our accepted offer.

The most aggravating part is that everything is through 3rd or 4th parties, so you never get to talk to the owner or the bank. You just submit an offer to the seller, who forwards it on to another company, who forwards it on to the bank.
A lot gets lost in translation and the bank is just looking at the property from a paper standpoint and don't take condition into account.

I do not recommend it to anyone who wants to move soon or if you are emotionally attached to the house in the least.
Short sales are for investors who have time and cash.

 

[ultimatebob]

Where did he say that? I missed it. I thought FHA loans were only for primary residences.

Also, I think his deficiency was $60k-$12k or $48k.

Yeah, this place was my family's home. I went with an FHA mortgage at the time, since the interest rate was 5.5% back at a time when most banks charged 6.75%. Just like when I bought the place, the bureaucracy added another layer of approval hassle.

My wife and I are back to renting now, but at least we're in a better neighborhood.

 

[alkemyst]

I just got out of a 3 month short sale debacle.
We put an offer in which they accepted, did inspections, got appraisal that matched our offer.
They took one month to tell us we needed to up our offer. We did.
They took another month to tell us that they denied our offer.
They now re-listed the property for 150k more than our accepted offer.

The most aggravating part is that everything is through 3rd or 4th parties, so you never get to talk to the owner or the bank. You just submit an offer to the seller, who forwards it on to another company, who forwards it on to the bank.
A lot gets lost in translation and the bank is just looking at the property from a paper standpoint and don't take condition into account.

I do not recommend it to anyone who wants to move soon or if you are emotionally attached to the house in the least.
Short sales are for investors who have time and cash.

Emotional attachment is how the banks win 🙁 Technically a home should be a pure financial asset/liability. I am sure ATOT's 'tough and rough' will cry this as a chant, meanwhile they probably are also upside down or living with the 'rents or as they like to call it 'renting'.

lol