Help For America's Homeowners

Upside Down? Do You Qualify for a Loan Modification or Refinance of your current Loan?

Call 1-888-995-HOPE 1-888-995-HOPE (4673) to learn about Making Home Affordable and to speak with a HUD-approved housing counselor for free. If you are having difficulties working with your mortgage company, ask for “MHA Help”.

Making Home Affordable Program

Selling a Home in Yuma, Arizona

Selling your home is an involved process that affects your family and your future. Before you begin this process, you'll want to ensure that you have the most up-to-date information. When should you sell? How do you get the best price? What kinds of renovations should be made prior to the sale?

These home selling reports will assist you in answering the many questions that arise during the home selling process. When you're armed with the right information, and an experienced real estate professional, you'll be closer to reaching your goal - selling your home fast, and for the best price.

Please contact me if you have any questions about selling your Yuma home.

Below, select desired reports and complete the form provided.

		The Right Selling Price When you’re selling your home, the price you set is a critical factor in the return you’ll receive. Learn several factors to base the assessment of your home.
		Common Selling Mistakes Learn the top nine selling mistakes and what steps you can take to avoid them.
		Selling Your Home - Where Do You Begin? Remember what first attracted you to your house when you bought it? What excited you about its most appealing features? Now that you're selling your home, you'll need to look at it as if you were buying it all over again.

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Short Sale Information

Common Short Sale and Foreclosure Questions

Posted on 01 March 2009
Tags: anti-deficiency, foreclosure, richard mack, short sale

By Richard V. Mack, Esq.

Short sales and foreclosures are becoming common place in our market. We are consistently asked questions by owners and agents alike about the Arizona anti-deficiency statutes and the tax consequences of a foreclosure or a short sale and deed in lieu. This article answers the two most common questions we receive.

When do the Anti-Deficiency Statutes Apply?
For the anti-deficiency statutes to apply, three requirements must be met:

The property at issue must be a duplex or a single family residence;
The real property must be two and one-half acres or less; and
The loan at issue must be a purchase money mortgage.

A purchase money mortgage is one where the loan proceeds are used to acquire title to the property. A refinance of a purchase money mortgage is also considered a purchase money mortgage for purposes of the statute. A HELOC that is obtained after the close of escrow is generally not considered a purchase money mortgage.

Assuming all three of these requirements are met, the Arizona anti-deficiency statutes apply. What this means is that the lender’s remedy will be limited to regaining possession of the real property at issue through a foreclosure process or otherwise. If the anti-deficiency statutes apply, even if the amount due to the lender exceeds the value of the property, the lender may not pursue the borrower for the difference or deficiency.

What are the Tax Consequences of a Short Sale or a Foreclosure?
Generally, when a lender is unable to collect the full amount due on a note, this forgiveness of debt constitutes a taxable gain for the borrower. The theory is that the borrower is paying less than the full amount originally received when the loan was funded. Thus, where a lender is collecting less than the full amount due on the mortgage, either through a short sale, a deed in lieu of foreclosure or because of the anti-deficiency statutes, there will typically be a taxable gain for the borrower. The taxable gain is the difference between the amount owed to the lender and the amount received by the lender. Many lenders have been and will be issuing a Form 1099 to borrowers for this debt forgiveness. Under certain limited circumstances the Mortgage Forgiveness Debt Relief Act of 2007 may eliminate the consequences of this gain.

The information set forth in this article contains general rules only. It should not be construed as legal or tax advice. If you or your clients have any specific questions based on their specific circumstances, please consult your legal and/or tax advisor.