Are You Facing a Short-Sale

A short-sale occurs when a homeowner is unable to make mortgage payments and the institution "holding" the mortgage agrees to a sale in which the purchase price will be less than the outstanding mortgage amount.

A homeowner might ask: "If I'm unable to make my mortgage payments, isn't it just as easy to "walk away" from my house?" The answer is: "yes, it might be" but there are long-term complications that will "follow you" for quite a few years afterwards if that's what the homeowner does.

If you are having difficulty making your mortgage payments when due I recommend a homeowner take the following steps :

• Contact your mortgage company immediately, don't wait until after you've missed a payment
• Do some research to determine your local real estate market condition
• Have a back-up plan in place if you have to move while your house is listed for sale

Your mortgage company may be willing to "work with you" to resolve the situation if you present a reasonable plan to correct the situation. The mortgage company would rather have the income stream from your payments rather than taking over the property on a default. This situation brings out "bottom-feeders" for buyers who only want the best deal possible for vacant properties. If your house must be sold, at least it will be occupied during the listing period.

There's also the possibility that the tax code will be changed so that the "shortage" amount is not considered a taxable event for the homeowner.