Many economists view short sales as a way to address a problem that mortgage relief hasn’t fixed: properties that are “under water,” carrying more debt than the home is worth.
Even though it may not be the first and favorable option for most, short sale is the best way to get out of foreclosure. There are many advantages for all parties to go short sale but let’s concentrate with the homeowner.
The top advantages of a Short Sale for Homeowner:
- Forgiveness of the debt owed, price vs. loan amount
- The homeowner may opt to not make payments during the short sale saving homeowner thousands (there will be credit implications)
- The homeowner may be forgiven the difference taxed by the IRS. (the homeowner must speak with a tax expert to understand the tax implications)
Yes there are other advantages and liabilities but the short sales beats out the rest.