real estate questions

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markgum

markgum

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all;
with the move to WA, and owning a home in CA. I am wondering if anyone has real estate advice.
I have the home listed with a real estate agent, for a short sell. One person tells me that a short sell will have the same impact on your credit report as a foreclosure another says, a short sell will not hurt your credit as bad??
One thing that has me really wondering, why would my real estate agent need/want copies of my bank statements for the past 2 months, and past 2 years of tax returns?? I am hesitate to give this information to them. If I was trying to buy a home, I could understand it, but just trying to get rid of the expensive home, that is now 15 hours away from my new job. I am not sure why??
I know, I'm asking detailed questions. Maybe I picked the wrong agent.??
thanks.
mark
 
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Sounds like you are upside down on your house. You owe more than you can sell the house for. Not a good sistuation to be in, but you will have to work your way free of the present mortgage and it will probably cost you some. Working 15 hours away has nothing to do with anything. Not sure why a RE agent would need your tax info, would make more sense if you were applying for a mortgage. Who knows, just ask the agent the questions, and they will know more than us ol' penturners.
 
First time I heard something like this too.

I agree, ask the agent your questions why they need those information/documents. If you are not satisfied, get a 2nd opinion from their competition.

Economy is tough, realtors are not immune to it and need all the business they can have too.

Good luck!
 
As far as I know the foreclosure will definetly impact your credit score negativly, but not as much so for a short sale. If you have already had legal procedings started for foreclosure It will show up but you will be able to clarify that you sold it rather than let it go to foreclosure when you have it become an issue in the future. Ask your real estate agent directly why do you need this and what is it being used for. I started in foreclosures buying them off the steps of the court house and later beccame a real estate agent. Unless your agent is involved with the bank in negotiating what price the bank will actually accept for the short sale and he needs to be able to show this info to the bank/mortgager he should not need this info. You also would have had to provide him written permision for the bank to talk to him about your loan or they cant discuss your loan with him. ANd if he needed then for the bank why would they not have requested it of you earlier on. or he could have you supply them directly to the bank. I would not provide this information until your agent has provided a top notch reason for needing theese things from you. Mike
 
sounds hinky to me too...they have no need for that info...(unless there is some new gov't program that requires that info) sorry about your troubles..hang in & glad to see you found a new job...congrats
 
It's pretty simple really IMHO.

You have to show whoever has the loan on your home that your not just trying to get out the house when you actually have the money to pay for it to justify the short sale. You actually have to have a reason to get rid of the house other than just not wanting it anymore. In the case of a short sale, the realtor doesn't work for you, they are working for the lender, and the lender calls the shots. They set the price, and your still responsible for the home up until a contract has been signed. At least here in Ohio that's the case.

Honestly I don't think anyone knows how a short sale will affect your credit rating due to so many different things affecting the economy right now. It used to be as bad as a forclosure, but I'm not so sure that's the case any longer.
 
There was something going around our office a while back that mentioned we should go out and run up as many charges as we could because a credit rating isn't going to be worth a thing once the credit agencies all go under. This was a joke at the time, but it sure does get you wondering.
 
A short sale will have a negative impact on your credit report if at closing you have negative equity. In essance, this amount is being forgiven but you will get a 1099 for that amount and you will be taxed on it. It will also show as uncollected debt on your report. The reason the agent wants your financial info is to verify with your lender that you in fact do not have sufficiant cash reserves to make up the difference. No funny business there, but the lender needs to make sure you are not just trying to dump the house and use your finds from your offshore account to buy a new one.

Kevin
 
What is Short Sale?

A real estate short sale is when you owe more than your properties currently value but you need to sell. In a typical situation, your mortgage lenders would require you to come in with the difference in the amount owed. A real estate short sale is where we negotiate with you lenders to accept a pay-off that is less than you currently owe and you do not have to pay the difference.

What is Required for a Real Estate Short Sale?

In order for us to get a real estate short sale accepted for you, we first must list your home for sale. During the listing period, you will need to provide the following documents to us so that we may package a real estate short sale request to your existing mortgage lenders.

Documents required for Real Estate Short Sale

Please gather the following:

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[FONT=Arial, Helvetica, sans-serif]Last two years tax returns with W-2's and any tax schedules[/FONT]
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[FONT=Arial, Helvetica, sans-serif]Most recent two months of paystubs[/FONT]
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[FONT=Arial, Helvetica, sans-serif]Most recent two months of bank statements for all your accounts, including retirement accounts, 401k.[/FONT]
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[FONT=Arial, Helvetica, sans-serif]Current mortgage payment coupons for existing mortgages[/FONT]
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[FONT=Arial, Helvetica, sans-serif]Copy of original mortgage note and deed of trust[/FONT]
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With these documents we create a package as to why you require a real estate short sale and submit this to the appropriate department at your lender, once we have an accepted purchase offer for your home.

[/FONT]From a Remax website in California.


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keandkafu said:
A short sale will have a negative impact on your credit report if at closing you have negative equity. In essance, this amount is being forgiven but you will get a 1099 for that amount and you will be taxed on it. It will also show as uncollected debt on your report. The reason the agent wants your financial info is to verify with your lender that you in fact do not have sufficiant cash reserves to make up the difference. No funny business there, but the lender needs to make sure you are not just trying to dump the house and use your finds from your offshore account to buy a new one.

Kevin
Click to expand...

This is not necessarily true. The Mortgage Debt Relief Act of 2007 has some provisions for Qualified Principle Residence Indebtedness.

Basically, this allows for the exclusion of income earned as a result of modification of the terms of the mortgage (short sale, debt restructuring), or foreclosure on your principal residence.

That being said, you will still take quite a hit on your FICO score, but you won't be prohibited from getting another loan immediately with Fannie Mae or Freddie Mac.
 
Mark: If you are going for a short sale the person representing you needs to prove to the lender that you truly are in a position not to afford the house. Subsequently the tax returns and the bank statements. As far as the credit report, it depends on how your lender reports it. if they take a hit, you bet they are going to report it.
 
thanks all for your input. been spending hours reading the web sites and such, and it looks like yes, the agent does need the info as said, to prove I don't have the money to pay for the house.
meanwhile, it's an emotional roller coaster, and SWMBO, is having a rough time with it all. It will be another 3 weeks before I go back to CA and move her and my shop up here, so meanwhile trying to do all this over the phone.,,
thanks again for everyone's input.
 
Mark I watched a news segment on problems BUYERS are having on short sales, some homes are sitting vacant for a long time, hardest hit areas were Phoenix AZ and Las Vegas NV. California markets might be better, on some homes the mortgage holders had been dragging out closings over a year, hoping the property values would rebound.
 
Sorry for being so harsh. But a better informed person has a better chance at succeeding at their goals. I was a real estate lender and mortgage broker for over twenty years. Banking in general for forty five years. Good luck to you.
 
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