As we approached the end of 2012, Orange County homeowners were waiting for Congress and President Obama to act as the nation quickly approached the Fiscal Cliff but thankfully the country averted the Fiscal Cliff, with a last minute deal that will keep the country going forward during these tough economic times.
Mortgage Forgiveness Debt Relief Act Extension
One huge benefit of the last minute Fiscal Cliff deal was the extension of the Mortgage Foregiveness Debt Relief Act (MFDRA), this important piece of the American Taxpayer Relief Act of 2012, will continue to provide protection for taxpayers across the country, from the threat of having to pay taxes on up to $2 million dollars of debt from their homes should they choose short sale or foreclosure.
Housing Market Will Continue Improving
Thanks to the extension of the Mortgage Debt Relief Act, top Orange County Realtors can expect the housing market to continue the growth that we saw in 2012 as more distressed homeowners across the country will continue to choose Short Sales, Foreclosures and mortgage restructuring to get out from their underwater homes or restructure their mortgages so they can stay in their homes.
What would have Happened If MFDRA Expired?
If the Mortgage Forgiveness Debt Relief Act expired, any benefits that homeowners would have received from Short Sales would be totally gone and there would be fewer Short Sales on the market in 2013 than there were in 2012.
With fewer Short Sales on the market in 2013 there would be an even smaller inventory of homes than in 2012, which would make it even harder for homebuyers to find homes for sale in Orange County or anywhere else in the country.
Long Term Expectation
Even though the Mortgage Forgiveness Debt Relief Act was extended, the current extension of MFDRA is expected by many top Realtors to be the last extension. As a result, distressed homeowners in Orange County or anywhere else across the United States should consider short sales this year.
To learn more about the Mortgage Forgiveness Debt Relief Act or to find out what you need to know about short selling your home, contact Fred Sed & Associates today by calling (949) 272-0125.