Destin Florida Short Sales & Real Estate by Wendy Rulnick

Borrower:  Elderly gentleman at retirement age

Property:  Florida home that was rented out, tenants vacated

Lender:  Green Tree Servicing

Hardship:  Major expenses due to spouse being in head-on collision. She will require extensive medical treatment for years and require relocation for appropriate care. 

Mortgage status:  Payments kept current from savings.  Account drained from $35,000 to $3,000.

Seller’s Logic to Make Payments:  “I am keeping up my end of the mortgage agreement in good faith”

Green Tree Conclusion: Short Sale Denied

Green Tree Investor states:  “We are willing to take a hit if you are willing to take a hit on your credit.  You are current with your payments.  Short sale denied.”

You think I am making this up?  I am not.  This homeowner contacted his lender before asking me to sell his home as a short sale.  He was told he could continue to make his payments and his short sale would be considered.  Yet, he was denied.  Guess what?  After I notified him of the denial, he said he will no longer be making his mortgage payments.  He held up his end of the bargain as best he could and tried to save his lender the cost of foreclosure. Thankfully, a kind Green Tree representative is going to swat the investor in the head so they LOOK at the situation, as she said, like a “human being, not a computer”.

People, do not be alarmed.  This is NOT the norm.  Most short sale lenders WILL consider a short sale if you are current with your payments  IF you have a legitimate hardship.  For example, IF you are using your savings to make payments, charging on credit cards, borrowing money, taking funds out of retirement, have a military base relocation, etc.  I am neither endorsing nor recommending that you make payments or don’t make payments. That is a personal decision.  And it is a tough decision.  Do what is right for you. 

This elderly gentleman may yet find that there is hope for his situation and that he can avoid foreclosure.  He made his payments in good faith and left his family with almost nothing.  Perhaps this investor will reconsider his short sale and offer him some good faith, too.

It's Wendy!

Wendy Rulnick, Broker, CRP, CRS, GRI, ABR     Rulnick Realty, Inc.

Destin FL Real Estate

Destin Short Sales & Pre Foreclosure Help.

Read Wendy's Destin Real Estate Blog

www.ShortSaleSuperstars.com for agents

Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204

Email Wendy: itswendy@rulnickrealty.com

Wendy is a short sale and pre-foreclosure specialist and has been featured in "Kiplinger Personal Finance Magazine" and "Florida Realtor Magazine". Call Wendy Rulnick, Broker/Owner,to list and sell your home or condo on the Emerald Coast of Florida in Walton, Okaloosa and Santa Rosa County-  Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.

Curious what your credit score will drop when you do a short sale?  You’ll often read on the internet 80-100 points, sometimes less.  Guess what?  Sometimes it is more.  I just received this email from one of my Santa Rosa Beach Florida short sale sellers.  I sold his home a few months ago.  I had asked him to check his credit score before and after the short sale.  Here is his email:

“Checked on my credit score with Transunion and went from 780 (Excellent top 2 percent) to 633 (Rated poor to good). I was anticipating somewhere around 680 and disappointed that big of a drop.”

My seller only had one mortgage loan on his home.  So, six missed payments and a short sale caused a 147 point drop.  I don’t know the other variables he had that may have affected his credit, like high charge card debt, etc.  But his drop is more than what is often quoted for a short sale. 

A short sale or foreclosure are both similar derogatory events on your FICO score.  However, a short sale will have a lesser impact on your future ability to borrow than a foreclosure or deed-in-lieu of foreclosure.  

Fannie Mae, the nation's largest backer of mortgages, has guidelines that favor those who do short sales versus foreclosures or deed-in-lieu of foreclosure.  In fact, you may be able to purchase a new home immediately if you have no missed payments and were not required to sign a promissory note or deficiency judgment was not entered. Otherwise, the waiting time is normally only 2 years after a short sale to buy a new home.

If you do a deed-in-lieu of foreclosure (turning in the keys) you will have to wait 4 years to apply for a mortgage with restrictions up to 7 years  If you do a "walk-away" foreclosure, you will have to wait 5 years with even more stringent borrowing terms and a credit score of at least 680.

Additionally, your chances of a deficiency judgment may be less with a short sale, since you are working with your lender to resolve the problem. In other words, with a short sale, your lender is not “taking” your property back and you are not leaving it in their lap.

So, don’t just focus on your credit score when contemplating your alternatives.  Compared to foreclosure, a short sale may be your best choice when it comes to your future financial security.

It's Wendy!

Wendy Rulnick, Broker, CRP, CRS, GRI, ABR     Rulnick Realty, Inc.

Santa Rosa Beach Short Sales & Pre Foreclosure Help.

Read Santa;Rosa Beach Real Estate Blog

Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204

Email Wendy to sell your home or buy a home: itswendy@rulnickrealty.com

Call Wendy Rulnick, to help you sell your short sale home in Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field, Florida.   Wendy Rulnick has been featured in "Kiplinger Personal Finance Magazine" and "Florida Realtor Magazine".

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This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice.  The information provided is for educational and informational purposes only.  It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

Yesterday I received a phone call from an elderly seller who wanted to do a short sale.  She had bought a waterfront condo in Destin four years ago, and paid over $800,000.  Today, the unit is worth around $350,000.  Mrs. Seller told me she had three "friend" investors convince her to buy, who promised to help with the payments.  She put down $50,000 and her son put down $75,000, but she took the mortgage in her name alone.  She told me the "investors" bailed, and had never made one payment.  Mrs. Seller said she had "had enough" so needed to do a short sale.  She stopped making her mortgage payments three months ago, and her lender was threatening foreclosure.

Mrs. Seller is in her late 70's, in ill health and has had major surgeries recently.  Her voice shook as she spoke with me.  I told her I would send her my preliminary paperwork including a financial worksheet for her to fill out, as I could tell her medication was preventing her from speaking coherently.

Later on, she called back, asking how she could list the unit.  I had not faxed her a listing agreement.  I told Mrs. Seller, "I want to see if you have a hardship before we list as a short sale".

The conversation then proceeded like this:

Mrs. Seller: " Well, I don't have a hardship."

Wendy, shocked: "You have sufficient income to pay your bills?"

Mrs. Seller: "Yes"

Wendy: "You are including the payment for the condo?"

Mrs. Seller: "Yes"

Wendy: "You are not taking money out of savings or charging a credit card to make payments?"

Mrs. Seller: "No"

Wendy: "Then WHY did you stop making your mortgage payments?"

Mrs. Seller, sadly: "Someone told me I had to stop making payments, then I could do a short sale"

Wendy: "WHO TOLD YOU THAT?"

Mrs. Seller: "I don't remember."

Wendy: "Well, Mrs. Seller, it seems you don't have a hardship and you are probably not qualified to do a short sale."

Mrs. Seller: "OH NO, I've ruined my credit for nothing!"

This is a very sad story. An elderly person probably had a friend say they "heard" somewhere you had to simply stop making mortgage payments, then you "qualify" for a short sale! This is FALSE information. Banks have several criteria you must meet.  And many banks have different rules. People, do not make serious financial decisions based on hearsay.  Do your research!  If you are contemplating a short sale.  Contact your lender first, to see if they can help you.  If not, find an experienced real estate agent who specializes in short sales.  Check them out on the internet.  Test their knowledge.  Use caution.

Finally, don't make hasty decisions when it comes to your financial well-being.  A short sale is a serious endeavor, and should not be entered into lightly.  Know what you are doing before you proceed.  Then go forward with a real estate agent you trust.

It's Wendy!

Wendy Rulnick, Broker, CRP, CRS, GRI, ABR     Rulnick Realty, Inc.

Destin FL Real Estate

Destin Short Sales & Pre Foreclosure Help.

Read Destin Real Estate Blog

Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204

Email Wendy to sell your home or buy a home: itswendy@rulnickrealty.com

Call Wendy Rulnick, Destin real estate agent, to list and sell your home or condo or help you buy a home or rental property on the Emerald Coast of Florida in Walton, Okaloosa and Santa Rosa County-  Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.   Wendy is a short sale and pre-foreclosure specialist and can help you sell or buy a short sale property in and around Destin Florida and the Emerald Coast.

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Are you enlisting me to help you sell your Short Sale?  I know you've been through a tough time of late.  I understand, and empathize.  I want to help you out of your situation with an upside-down mortgage, a need to sell your property, and a way to avoid foreclosure.  I will go "all out" to help you.  I will implement a 60-point checklist.  I will organize your documents.  I will call your lenders.  I will get you a written offer for your property, and prepare a package for approval that will be hard to deny.  During that time I will have made an average of 68 phone calls, sent dozens of emails, faxed a hundred pieces of paper and expended weeks of man-hours on your behalf.  I will do my part--  and if you are denied-- it won't be because of me.  But guess what?  YOU have to help.  I cannot do it alone.  So, before signing on the dotted line and hiring me to help you with your Short Sale, I need a commitment.  YOU, the Short Sale seller, promise and commit to the following:

You will return your listing paperwork to me within 3 business days.  That includes property disclosure, mold disclosure, condo disclosure, homeowners association or any other applicable disclosures.  I cannot represent your real estate properly without the same.

You will return your Short Sale documents to me within 3 business days.  This means your hardship letter, last two years tax returns, financial worksheet, letters of authorization, paystubs and bank statements as I require. If you don't disclose your financial information, you are NOT going to get approved.  If I don't have authorization to speak with your lender, I won't be able to help you.

You will keep your house presentable to show.  Please move your truck for your photograph and close the garage door.  Please vacuum the dog hair.  Please pick up the clothes and dishes.

You will provide a key for access to your house.  I will install a lockbox. I cannot sell your home by "appointment" only.

You will not rent the property for one-year term, with no early termination.  I cannot get an investor to buy your property in this market with a one-year lease.

You will disclose any liens on your property.  You will not "forget" there is a second mortgage.  Or an IRS tax lien.  If you do, you are wasting your time, my time, your lenders's time, the buyer's time and the buyer's agent's time.

You will inform me of any paperwork you receive from your lender, especially a Motion for Summary Judgment.  I need to know how long we have to sell the property, or I cannot do my job.

You will not remove appliances.  You will not strip the oven, dishwasher, microwave and garage door opener.  This will lower your market value in such a way that your lender's appraisal will not adequately reflect the damage, and your Short Sale may not be approved.

You will consult an attorney and/or accountant.  When I tell you that you need to consult a lawyer or tax specialist, you will not speculate.  When I tell you I am a licensed real estate agent and you have addressed an area outside my expertise, I mean it.

You will not "change your mind" in the middle of your short sale, or you will be prepared to pay a cancellation fee.  Changing your mind includes doing a deed-in-lieu of foreclosure, trying to modify your loan or filing bankruptcy.  If you do, you cannot expect my forthright efforts will have been for free. 

You will not "change your mind" after you have signed a contract.  In doing so, not only will you incur a cancellation fee, you may be sued by the buyer for performance, damages and maybe more.  Consult with your attorney on that one.

You will respond to my emails and phone calls.  Please don't hide from me.  I cannot move forward when you are missing, in denial or don't know what you need to do.

You will take the Short Sale process seriously. When your lender, through me, asks for documentation, they mean it, too.  They won't forget.  If you don't provide the required documentation, they will deny your Short Sale and your file will be closed.

In summary, if you want to hire me to help you- I will perform.  If you want to succeed, you must perform.

It's Wendy!

Wendy Rulnick, Broker, CRP, CRS, GRI, ABR     Rulnick Realty, Inc.

Search Destin Florida real estate

Short Sale Pre Foreclosure Help.

Read my Destin ReaL Estate Blog.

Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204

Email itswendy@rulnickrealty.com

Wendy Rulnick specializes in real estate sales, short sales, traditional sales on Emerald Coast of Florida: Destin Florida real estate, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Crestview, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.   Wendy is in the top ½ percent resale agents on the Emerald Coast, and was featured in Kiplinger Personal Finance Magazine as a short sale specialist.

All Rights Reserved. *Short Sale Sellers: If You Want Me to Help "YOU" - You've Got to Help "Me" Contact Wendy Rulnick regarding Destin Florida real estate and vicinity. Copyright © 2009 by Wendy Rulnick.

This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice.  The information provided is for educational and informational purposes only.  It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

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Do you have an IRS Tax Lien on the property you are trying to sell?  Is your property's market value less than your mortgage payoff?  If so, you are in a short sale situation, and a federal tax lien may cause your lender to deny your sale.  Why?  If, for example, your home is worth $200,000, your mortgage payoff is $250,000 and your tax lien is $20,000, there would not be enough funds to pay the IRS.  Your mortgage holder will not pay these taxes for you.  The good news is that the IRS is trying to make it easier for homeowners to discharge the liens to sell their property. 

In December, the IRS announced it would be streamling the process to discharge liens. Commissioner Doug Shulman says, "We realize these are difficult times for many Americans. We don't want the IRS to be a barrier to people saving or selling their homes".  The lien discharge process takes approximately 30 days for approval.  To apply for a discharge, you must follow the instructions in IRS Publication 783.  Briefly, be prepared to submit:

1. Deed or title and property description
2. Purchase and sale agreement
3. Preliminary title work showing all liens on the property
4. Broker Price Opinion
5. Certifed Appraisal
6. Loss Mitigation Letter (approval from short sale lender)
7. Your name, address and telephone number
8. IRS-specified declaration that you are being truthful

There are variations of tax lien discharge scenarios, some more complex than others.  You may want to consult with a tax attorney or accountant to complete the paperwork.

It's Wendy!

Wendy Rulnick, Broker, CRP, CRS, GRI, ABR     Rulnick Realty, Inc.

Search Destin FL real estate

Short Sale Pre Foreclosure Help.

Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204

Email itswendy@rulnickrealty.com

Wendy Rulnick specializes in real estate sales, short sales, traditional sales on Emerald Coast of Florida: Destin Florida real estate, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Dune Allen, Blue Mountain Beach, Freeport, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.   Wendy Rulnick, Broker and Realtor, has been selling real estate for 20 years.  She has won numerous awards, including the coveted ADDY for advertising design. Wendy lists and sells homes, condos and townhomes in Destin FL and the surrounding areas.  She is ranked in the top ½ percent of all Realtors on the Emerald Coast of Florida for resale listings sold and was featured in Kiplinger Personal Finance Magazine as a short sale specialist.

All Rights Reserved. "Don't Let IRS Tax Liens Stop Your Short Sale" Contact Wendy Rulnick regarding Destin Florida real estate and vicinity.C opyright © 2009 by Wendy Rulnick.

This site, Wendy Rulnick or Rulnick Realty, Inc. is not providing legal or tax advice.  The information provided is for educational and informational purposes only.  It is recommended that sellers considering a short sale should consult an independent legal and tax advisor for more information.

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