Short Sales

A Short Sale can be the solution when the proceeds from the sale of your home would not be enough to cover the mortgage payoff, commissions, and all other closing costs. It is a common situation in today's market, especially if the home was purchased as a new home in the past 3-4 years, and/or at least 90% of the purchase price was financed. Many people think that the only choice is foreclosure because they don't know about the Short Sale option. However, a short sale is more advantageous to you both in the short and long term for the reasons below. 

The Marley Team offers a wealth of information to sellers considering a short sale samples of which can be accessed on the left side of this screen. Our experience helps sellers navigate smoothly through the short sale process and avoid common mistakes that can cause a seller to lose their home through foreclosure.

BENEFITS OF A SHORT SALE

Credit Score

• A foreclosure will appear as a public record on your credit report the same as a bankruptcy. It will drop your credit score 200 - 300 points and will be on your report for 7 - 10 years.
• A short sale will only reflect the late mortgage payments on your credit report. It may only drop you 50 points and the negative impact can be as little as 12 - 18 months.

Future Buying Ability for a Primary Residence

• A foreclosure will make you uneligible for a Fannie Mae backed mortgage for 5 years.
• A short sale will make you eligible for a Fannie Mae backed mortgage after only 2 years.

Future Buying Ability for an Investment Property

• A foreclosure on an investment property will prohibit you from getting a Fannie Mae backed mortgage for 7 years.
• A short sale on an investment property will allow you to get a Fannie Mae backed mortgage after only 2 years.

Deficiency Rights

• A foreclosure allows many lenders in California the right to pursue the homeowner for a deficiency.
• A short sale typically provides a written statement from the lender releasing the homeowner from any future deficiency after the close of escrow.

Taxes

• A foreclosure will generate a 1099-A at the end of the year for the amount of money the lender has written off. This could be income that you may be responsible for paying taxes on.
• A short sale will generate a 1099-C at the end of the year which highlights the cancellation of debt.

Current and Future Employment

• A foreclosure can be grounds for termination or reassignment since employers have the right to check the credit of all employees in sensitive positions. It may pose as one of the most serious hurdles to overcome when seeking employment.
• A short sale is not public record and the employer will only see late payments and that your account has been settled. This proves you worked with your lender towards a favorable resoluation which will look better to your employer.

 A short sale is the best answer for you!