Facing Foreclosure? Stop Foreclosure Las Vegas

Nevada Property Solutions, Inc - Las Vegas, NV - Tel: (702) 475 6540

STOP LAS VEGAS FORECLOSURE

Are You Struggling With Your Mortgage Payments, Recently Laid Off? Have Just Enough Saved For One Or Maybe Two More Payments?

You Don't Have To Struggle Any More, Learn About the Options Available, Know Your Rights & Protect Your Credit.

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las vegas foreclosure, foreclosed home, REO, bank owned

Short Sales Explained

Why a short sale?

A short sale is where your lender(s) agree to take a discounted payoff to settle your mortgage loan. This special transaction that allows a homeowner to sell their property for less than they currently owe on it.

Avoid Foreclosure
Protect your Credit from having a “Foreclosure” on you credit report
Be free of the emotional stress and financial burdens

We know how to negotiate a settlement with your lender(s) even if you owe more than the property is worth. Not only that, unlike a Realtor®, we are investors who will buy your home directly from you if we can successfully negotiate a short sale. A short sale is a timely process that requires a trained professional who has experience negotiating with banks to save you from future liens and credit judgments.

What is a Short Sale?

A short sale, negotiated settlement, or short payoff occurs when a lender agrees to accept less than the amount owed to payoff a home loan as an alternative to foreclosure. The lender usually agrees to a short sale because they know if they take the property back through Nevada Foreclosure Law they are going to take a bigger loss.

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Once the bank has taken the property into it’s REO department, there are holding costs, property taxes, HOA fees and repairs, in addition the property will normally be on the market much longer than a non REO property, increasing the bank’s exposure, and will usually sell for a lot less than other similar properties in the neighborhood.
We can show your lenders that they will be better off if they take less than what is owed now, rather than taking the property back through the Las Vegas foreclosure process and trying to sell it later. Keep in mind, not all lenders will accept a short sale or discounted payoffs if it would make more financial sense for the lender to foreclose.

Example of a Short Sale

A Las Vegas homeowner has an unpaid home loan balance of $275,000. Their Las Vegas property value has decreased over the last few years, they are underwater and their home is now worth just $150,000. We submit a package of documents to their lender with our offer to buy the home, and supporting documents explaining why the lender should accept a discount. Once our offer is received, we negotiate with the lender on behalf of the seller. We get the lender to agree to accept an offer of $125,000 as payment in full. We buy the home and the seller’s credit shows loan has been settled. In some cases, a second or even a third mortgage may exist on the property. When this occurs, the process becomes much more complex. We will need to negotiate between all the existing lenders as to the actual payoff amount they are willing to accept in relation to the other lenders.

Advantages to a Short Sale Vs Foreclosure

A short sale will have far less impact on your credit in the long term, many people who are facing a foreclosure will have some missed or late payments on their credit report and your credit score will suffer in the short term, however, doing a short sale, even if you are in a bankruptcy is a huge step in the right direction if you plan to rebuild your credit and own a home again some day. At the very least it will keep your wait, under current mortgage guidelines, to 24 months as opposed to 5-7 years (Fannie Mae & Freddie Mac guidelines). By law, foreclosure stays on your credit report for 7 years. Bankruptcy also remains 7 to 10 years depending on what chapter you file under. A foreclosure is also reported on your credit report twice, once by the creditor and once in the public records section. Typically a settled account such as a short sale or a credit card settlement, will affect your credit score negatively for around 12 months. After that first year the negative impact begins to greatly diminish, assuming you remain current on all other credit accounts. For more information on credit and credit repair visit the Federal Trade Commission website.

How much do you charge to negotiate with my lender?

We do not charge any fees to the homeowner, we are buying your property at a discount by negotiating with your lender. We may keep the property as a rental or choose to resell it for a profit.

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How Long Will it Take?

The Las Vegas short sale negotiation process can be lengthy. It may take between three and six months before we can agree on acceptable terms with your lender, in some cases (Bank of America) it can take longer. Many lenders have thick layers of bureaucracy that we will have to maneuver through in order to get your short sale approved. We understand how painful your original situation may be, so we make a special point to communicate with our homeowners on a regular basis whenever there is an update or progress to your file.

But My House Is Going to Auction, Will I have Enough Time?

Starting a short sale negotiation will not automatically stop the lender from continuing with the foreclosure process. However, we can usually convince lenders to postpone the foreclosure auction while we negotiate. While there are no guarantees, once the lender sees that we are serious about buying your home they will usually stay the auction.

Can I Stay in the House?

The key word in short sale is SALE. The purpose of a short sale is to stop the foreclosure by selling your home. So, you do have to move. This is not a program that can stop foreclosure and allow you to keep the house. If anyone tells you you can rent the home back and purchase it from them at a later date, be aware you maybe committing mortgage fraud. There are strict laws governing this type of activity.

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Will I Get Any Money From the Sale?

A general requirement of the lenders in granting a short sale is that the borrower will not get any proceeds from the sale of the property. The lender is going to take a loss on the home loan – they are not going to let you get any money. If anyone tells you they can get you money at the closing be vary wary. In some cases we may be able to get you a small amount to help you move, but this will not come from the settlement.

How Do I Know This Will Work?

There are No Guarantees…. be very cautious of anyone who offers a guarantee that they will be able to negotiate a short sale. We will not make any promises to you that a short sale will work. Once you missed a payment, the lender is in charge and can proceed with foreclosure if they decide on that option. However, in light of the current Las Vegas real estate market, lenders are aware that they might have a better chance of selling a home via short sale instead of reclaiming the property in a Las Vegas foreclosure.

What Happens if This Does Not Work?

If you are facing a Las Vegas foreclosure, the mortgage lender may be willing to work out a payment plan with you or a forbearance agreement, however, a short sale is often times a last resort before the house is sold at auction. Be prepared, in some cases where the mortgage has been resold to and investment group, they will not agree to a short sale. While this is not the norm we cannot predict this from the outset.

If my lender takes a discount do I still owe them any money?

This depends on the terms of the payoff, in all our Las Vegas short sale purchase contracts we stipulate that the contract is conditional on there being no deficiency to the homeowner. We push for a satisfaction of the note or a waiver that the lender will not file a Deficiency Judgement. If the lender refuses then we will offer to withdraw from the sale. Our goal is always to help the homeowner. We do not want to profit at your expense. If the lender will not accept full satisfaction we will ask you how you want to proceed.

What is a Deficiency Judgement?

A lender may offer to release its interest against the property in exchange for less than the total amount of the note. A release will allow the property to be sold, thus avoiding foreclosure, without paying off the obligations of the note. However, the note is not satisfied and the lender can obtain a judgement against the homeowner for the difference. In most cases the homeowner will be unable to pay often leading to bankruptcy.

What is a Satisfaction?

A lender agrees to accept less than it is owed as complete and total satisfaction of the note and release its lien against the property. Your note and obligation to the lender are satisfied for less than you owe. When the property is sold, the debt is paid off completely. The disadvantage is you may have some tax consequences that you should discuss with your tax advisor or CPA due to the fact that the lender is making money you owe disappear, the IRS considers this windfall income.

Will This Have Any Impact on my Taxes?

Uncle Sam, The Mortgage Foregiveness Debt Relief Act, tax, tax liabilty

On December 20th, 2007, President Bush passed “The Mortgage Forgiveness Debt Relief Act of 2007” which allows Las Vegas Homeowners a (3) year window to avoid paying taxes on the loss the lender takes. (The provisions of this act have now been extended through 2012). Before this act took affect, “If the value of your house declined, and your bank or lender forgave a portion of your mortgage, the tax code treated the amount forgiven as income that can be taxed.” According to “The Mortgage Forgiveness Debt Relief Act of 2007” if you sell your home as a short sale by December 2012, the loss the lender takes will not be considered taxable income by the IRS.
After a short sale your creditor will issue a 1099C for the ‘forgiven debt’. The IRS gets involved with short sales because they are seen as a relief of debt and may be treated as income. Here is more information on understanding your 1099C. For expert tax advice contact Brent Barlow (702) 735-5030, LL Bradford & Co. Las Vegas

What type of paperwork do I need?

The lender will require some documents from you to complete your Las Vegas short sale, this usually includes:
(2) Months’ bank statements (2) Months’ pay stubs (2) Years’ IRS tax returns
Additional documents will be needed as required by your lender. These may include things that document hardship, e.g. medical bills, pink slip etc. The leading cause of delay and even denial of our offer to the lender is caused by the seller failing to deliver these items in a timely manner. To help us succeed your co-operation is vital, please find as much of this information as you can right now. We will be contacting your current lenders and requesting their documentation they need completed and this may include a financial worksheet. This will help us work faster and increase our success.

* The State of Nevada is a deficiency judgment state. What does that mean; lenders can legally file a judgment against a homeowner for the loss they take when they agree to a short sale or when they have to foreclose unless the lender agrees not to do so as part of the settlement.

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If your house payments are more than a month or two behind, your lender has probably already started the foreclosure process. As time passes many thousands of dollars in penalties and legal fees can be added to the balance you owe. Every single day extra interest is added! The longer you wait, the harder it is for us to help you. To avoid this YOU MUST ACT QUICKLY

CALL TODAY to find out if a short sale is right for you, we can save you from foreclosure before it is too late. There are many solutions available,
you do have choices. ACT NOW, DON'T DELAY!

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and hope for a miracle. Don't fall into that trap!

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