Short Sale or Foreclosure in Bryan College Station Tx Does It Really Matter to Me Part 2

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Short Sale or Foreclosure in Bryan College Station Tx Does It Really Matter to Me Part 2

In the previous post  Short Sale or Foreclosure in Bryan College Station – Does It Really Matter Part 1 short sales and foreclosures were defined and many future issues were discussed. Part 2 is a continuation of that post.

What else needs to be considered when deciding whether to let a house go back to the bank through foreclosure or if a short sale is the best option.

  • Future Employment – Credit checks are often done by employers. Remember the foreclosure will show up on the credit report while a short sale will not!
  • Deficiency Judgment – This is almost always a surprise to owners whose home is foreclosed. Yes, the bank has the right to go after you for the difference between what they are owed and what they get when the sell it after expenses. And, yes this can be a lot of money!!!  In a short sale this issue is usually resolved PRIOR to the sale so you don’t have a surprise debt later on.

One last issue that should be investigated with an attorney and/or tax accountant prior to the foreclosure or short sale is the “phantom tax.”  The phantom tax being referenced is the forgiveness of debt tax. Normally if you have a debt (the loan not paid) and it is “forgiven” or not collected you may owe ordinary income tax on the amount not collected by the bank.  I don’t know about you but having the IRS after me is one of the last things I want!

So, if you know someone who is behind in their house payments or have lost their job or had an illness or death in the family and they are not going to be able to continue making their house payments PLEASE call me and let me see what we can do to help.  Even if all you do is get information you are much better off KNOWING what is coming than being surprised. Help College Station and Bryan homeowners so we PREVENT foreclosures in our cities which helps ALL our property values hold firm!

 

 

 

 

For more articles on Foreclosures and Short Sales –

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