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Chris Ann Cleland, Associate Broker, Northern VA

Wait for the Market to Give You Equity or Sell in a Short Sale?

Wait for the Market to Give You Equity or Sell in a Short Sale?

As a Northern Virginia Short Sale Agent, I meet plenty of home owners who are hanging on by the skin of their teeth, waiting for the market to bring back some much needed equity so they can either refinance their existing mortgage(s) or sell and break even. Two-thousand twelve may not be the year to continue to wait out the return of your equity if your principal residence is the one upside down. Here's why.

The Mortgage Debt Forgiveness Act expires at the end of 2012. That's what we KNOW. That means, if you are looking to sell your principal residence in a Short Sale, and the forgiven mortgage debt was used to either purhcase or improve your home, you qualify for income tax forgiveness.

Didn't know that a Short Sale was a taxable event? Well it is. When your mortgage company forgives the debt not repaid in the Short Sale, they provide you with a Form 1099 for the amount forgiven. Without the protection of the Mortgage Debt Forgiveness Act, having to claim the forgiven mortgage debt as income is a given.

Will the Mortgage Debt Forgiveness Act be extended? I don't know. I hope so, but when the Federal government has to act to make it happen, well, all bets are off on the outcome being the one you desire.

Will your home be worth what you need it to be in 2013 to refinance or sell and break even? I don't know. If I did, I'd be the most popular REALTOR® in Northern Virginia. It's certainly not likely if you are upside by a significant percentage of your home's value.

What I do know is that as of today, there are ten months left in the Mortgage Debt Forgiveness Act. The sooner you place your home on the market for Short Sale, the more likely you are to complete your Short Sale while falling into this protection by the IRS and the Commonwealth of Virginia. Want to roll the dice and see what next year brings? That's entirely up to you. I can't predict the future, but I can tell you that one of the best protections a Short Sale Seller has on their side expires in 2012.

Northern Virginia Short Sale Quiz: Question #5

Northern Virginia Short Sale Quiz: Question #5

I started this series of questions because there are a lot of misunderstandings about Short Sales in our Northern Virginia market. If you want to catch up with question #1, question #2, question #3 or question #4 just click the appropriate link.

Buyers just submitted an offer of $300,000 on a Short Sale listed for $400,000. The Buyers receive a counter offer from the Sellers for $390,000. Can the Sellers counter their offer of $300,000, or must the original offer be submitted to the bank?

Answer simply YES or NO.

Check back tomorrow for the answer.

Chris Ann Cleland, Individual Top Producer for Long & Foster Gainesville for 2011

Chris Ann Cleland, Individual Top Producer for Long & Foster Gainesville for 2011

Why bury the lead? That's what I learned in my journalism studies while attending George Mason University. Today was Long & Foster REALTORS® Gainesville's annual awards breakfast. Most people come for the breakfast prepared by the omelet chef. Competitive folks like me want to find out who did what in production and celebrate the success stories.

Last year I sold over $8 Million in real estate. A lot of which were Short Sales. I knew I had achieved Chairman's Club status which is the club for those achieving between $5 Million and just under $10 Million in sales. What I didn't know was that I had won in two very special awards. The first was for the Biggest Production Increase in Millions from 2010 to 2011. My sales volume doubled in one year. Woo-hoo! Of course I knew that, but didn't know it was the tops in terms of office increase.

The second award had quite a ramp up in which my Managing Broker, Forrest Odend'hal likened the recipient of the award to a game cock...you know...a fighting roster. Someone who had a lot of fight in them. The award was for the individual with no assistant or team, who had the highest production for 2011. The Individual Top Producer for our office. I was honored to have won.

In our office of approximately sixty agents, I was so very happy by the recognition I received today. And a surprise gift was each Top Producer's to take. Three weeks ago the Top Prodcuers for 2011 were asked to attend a photo shoot. We did and the results of it have been top secret until today. No wonder. We got life sized stand ups of ourselves with our motto's emblazened on them. They are for the purpose of using in marketing our open houses, or whatever else we see fit. It's quite something to be packing yourself into your car, or putting yourself in a closet.

Taking the morning to celebrate our success was fabulous. Now, it's time to get back to the grindstone.

Northern Virginia Short Sale Quiz: Question #4

Northern Virginia Short Sale Quiz: Question #4

Northern Virginia Short Sales are a topic on which there is a TON of misinformation. We've already had question #1, question #2 and question #3. In question #4, we are going to address a really critical point.

Sellers of a Northern Virginia Short Sale with two loans (a 1st trust and a 2nd trust) have just received an offer on their property. The Buyer would like 3% of the sales price in closing cost help.

Who is paying for the closing cost help to the Buyers?

A) The 1st Trust

B) The 2nd Trust

C) The Sellers

D) The Real Estate Agents

Check back tomorrow for the answer.

Click here for Northern Virginia Short Sale Quiz: Question #5

Northern Virginia Short Sale Quiz: Question #3

Northern Virginia Short Sale Quiz: Question #3

To clarify some of the major misunderstanding that buyers, sellers and real estate agents have about Northern Virginia Short Sales, I've decided to give you this quiz. We've already had questions #1 and #2. Now we are on to question #3. It's going to involve reading this scenario first.

Buyers and Sellers come to terms with their Northern Virginia Short Sale Contract. In the contract dated May 5th, they agree to the price and to make the settlement date in the regional sales contract on or before September 10th. The Short Sale Addendum reads that the Buyers will allow the Sellers until August 10th to deliver Short Sale Approval and they will be settle 30 days after the approval has been delivered to them.

The Sellers deliver Short Sale Approval to the Buyers much faster than anticipated on June 5th. The Short Sale Approval Letter states that Settlement must occur on or before July 30th. What date, per the contract, is Settlement to occur on or before?

A) August 10th

B) September 10th

C) July 5th

D) July 30th

Check back tomorrow for the answer.

If you are ready for Northern Virginia Short Sale Quiz: Question 4, click the link provided.