In 2012, Short Sales ticked up from the year before thanks to the Mortgage Debt Forgiveness Act. Distressed homeowners turned to Short Sales vs. foreclosing on their homes because, Short Sales offer many benefits including: speed of the Short Sale transaction, return on investment for lenders, and less damage to a distressed homeowner’s credit report.
More Than A Fiscal Cliff
Thanks to the Mortgage Debt Forgiveness Act, distressed and underwater homeowners in the United States can enjoy the benefit of not having to pay taxes on the remaining balance or short fall that remains after their Short Sale is approved.
Without the extension of the Mortgage Debt Forgiveness Act, homeowners would be faced with having to pay thousands of dollars in taxes because, the remaining balances on their mortgages would be seen as income by the IRS. This would mean that the average distressed homeowner would ultimately choose foreclosure over Short Sale or loan modification.
Potential Damage To The Housing Market
At the last minute, Congress and President Obama came together to approve an important deal which helped the country to avoid going over the Fiscal Cliff. Why did both political parties in Washington come together and agree when they could have remained divided? The answer is simple, without approving a deal, greater damage would have been done to the housing market across the United States thus sending the country into another recession.
Get Your Short Sale Started Today
If you’re an underwater or financially distressed homeowner, it’s time to move forward with your Short Sale today before January 1st 2014 when the Mortgage Debt Forgiveness Act is set to expire once again.
To get your Short Sale started, contact the experienced team of best Orange County Realtors today at Fred Sed & Associates by calling (949) 272-0125.