Due to our unstable economy, individuals who were able to religiously pay their loans before in the past are unable to do so now. If we cannot pay our loans, then foreclosure is just around the corner. No party to a loan would like to reach the foreclosure stage. As a result, we keep on searching for alternative options aside from property repossession to satisfy our loan. Short sale of property is one option. This is a kind of financial solution by selling your home for a price less than the balance of your mortgage. Using the profit from such sale, you pay the balance of your loan.
Some people have considered that a short sale is a smart decision in terms of finances. You have to pay your debt no matter what the cost so you will have fewer worries in the future. A short sale may at first seem like disadvantageous on your part as you get a lesser price than the one you originally paid for your home. However, real estate market home values have steadily declined over the years. This means that all property owners are in the same boat. If we have to sell, most probably we have no choice but to opt for a short sale to improve our chances of selling our residential property.
Those who decide to do a short sale of their property were given a tax relief under the Mortgage Debt Relief Act of 2007 which was extended to those made the said transaction in the year 2012 by the Economic Stabilization Act of 2008. You may also qualify for the government’s Home Affordable Foreclosure Alternatives Program or HAFA. You also avoid the stigma of foreclosure and repair your credit faster compared to undergoing property repossession proceedings. Just in case you find yourself in a bind, look at your options and think twice before ruling out short sale of property.
