When forgiven mortgage debt is not taxable

You can escape Federal and California income tax on forgiven mortgage debt in each of these situations:

 1.  Your Total Debts Are Calculated to Exceed Your Total Assets 

To the degree your total debts exceeded the fair market value of your total assets immediately before your mortgage was reduced or eliminated, you are legally “insolvent” and the cancelled mortgage debt is not taxable income.  Many California residents can meet this legal definition because they have home equity loans, auto  loans, rental property mortgages, and other liabilities that exceed the total fair market value of all their assets.  An experienced real estate attorney can easily help you with the expert appraisals and accounting needed to establish legal insolvency for tax purposes.

2.  Your Mortgage Was Eliminated or Reduced in a Chapter 13 Bankruptcy 

Chapter 13 bankruptcy allows judges to reduce or eliminate home equity loans and second and third mortgages.  This “forgiven” debt, no matter how large, is not counted as taxable income. Chapter 13 can also eliminate or reduce many other types of debt. Again, an experienced attorney can determine if you qualify for Chapter 13, and can help you decide whether this would be a good choice for your situation.

3.  The Mortgage Debt Relief Act of 2007 Applies

In 2007, Congress passed the Mortgage Debt Relief Act; it was extended in 2011 and now lasts through 2012.  Under that law, mortgage debt that is forgiven on a “qualified principal residence” is not taxable income if it is under set dollar limits and was forgiven as part of a mortgage restructuring, foreclosure or a short sale.  California has a similar law, but the dollar limits are different.  

Under this federal law, debt forgiven between 2007- 2012 can be excluded from taxable income if it is less than $2,000,000 for taxpayers who file as married filing jointly, single, head of household, or widow/widower, and $1,000,000 for taxpayers who file as married filing separately.  Under California law, these limits are $500,000 and $250,000 respectively for 2009-2012, and $250,000 and $125,000 for 2007-2008.  In California, registered domestic partners are treated the same as married taxpayers filing jointly or separately.  There is no federal limit on the amount of income that can be considered “qualified principal residence debt”; for California tax, the limit is $800,000 for the first group of taxpayers, and $400,000 for the second.

Only “Qualified” Debt Forgiveness Can Escape Income Tax

To be considered “qualified principal residence indebtedness” that can be forgiven without income tax owing, the mortgage debt must meet these requirements:

   1.  It must have been used to buy, build or substantially improve your principal residence and be secured by that residence.  Refinanced debt used for this purpose is also OK.

   2.  It cannot have been a “cash out” refinance where loan proceeds were used for other purposes, such as paying off credit cards, school tuition, or buying another piece of property.

   3.  It cannot have been debt on a second home, rental property, or business property.  For this and other non-real estate debts, you will need to come within the insolvency or bankruptcy exceptions.

Call San Diego Law Firm for Help with Mortgage Debt Strategies

Over 2,000,000 California residents are currently stuck with “underwater mortgages,” as California has suffered some of the largest decreases in property values in the nation. If you are in this situation, our experienced San Diego real estate lawyers can help you identify the best strategy for handling your mortgage while avoiding additional income tax on forgiven mortgage debt.  We provide skilled legal help with insolvency calculations and Chapter 13 bankruptcy, and can assist you with a deed in lieu of foreclosure and other real estate strategies that require legal documentation.  Please call San Diego Law Firm at (619) 794-0243 to schedule a consultation. We look forward to helping you.

There are many examples in California case law, and they generally do not favor the party who claimed that a commercial real estate “agreement to agree” was not enforceable because the parties could not agree.  For example, the California Court of Appeal in San Diego has noted with approval the authority of a jury to determine a “reasonable rental rate” for a commercial lease renewal where the landlord has not “negotiated in good faith” for a “reasonable” amount with the lessee of the commercial premises.  Similarly, the California Court of Appeal in Los Angeles has held that a “letter of intent” setting out the general terms for the purchase and sale of an ice-cream manufacturing plant is an enforceable “contract to negotiate an agreement” that required good-faith negotiation. The court determined that the amount of damages that can be awarded for one party’s “failure to negotiate a contract” is the amount lost by the other party who has detrimentally relied on the letter of intent.

Even more troubling, the federal Ninth Circuit Court of Appeals in California recently held that a signed “Final Proposal” that was missing a material term – the length of a ground lease – nonetheless created an enforceable ground lease with a put and call option to purchase.  The court upheld a $15.9 million award for the landlord’s lost rent for a lease term that was decided upon by the jury based on all the evidence, and for the loss of the value of the put option, even though the parties had been unable to agree on all the terms of the final agreement.

The bottom line:  when you are negotiating a commercial real estate contract in California, never sign any document – even a proposal, a letter of intent, or a current lease calling for future negotiations – unless the document also provides that either party can change its mind for any reason, and refuse to negotiate or exercise good faith to reach an agreement on any material term of a future contract, without further liability for any damages, including damages for detrimental reliance.

Call San Diego Law Firm for all Help with Commercial Real Estate Transactions

Before you negotiate or sign any commercial real estate agreement, contact the skilled business real estate lawyers of San Diego Law Firm.  We have many years of experience in negotiating and documenting all types of commercial real estate contracts, and have successfully represented many businesses in negotiating contracts to buy, sell, purchase, lease, build out, and develop commercial property.  We can help you and your business as well.  Please call San Diego Law Firm at (619) 794-0243 to schedule a consultation. We look forward to helping you.

            Trees and Other Plantings

A few cities and counties in California restrict tree height to preserve views; most do not.  However, if your home is in a planned development where views were an important feature of the initial home sales, your development’s CC&R’s may limit the height of trees, and provide that trees over a certain height must be trimmed or removed.  CC&R’s may also limit or forbid hedges or other tall plantings within a certain distance from one or more of the property lines. 

If a neighbor’s tree has branches that overhang your property, you have the right to trim those branches back to the property line.  You also have the right to dig down and sever tree roots that have come under your property and that are cracking your pavement or invading your water or sewer line. However, you need to use care in this, since you will be responsible if your root trimming destabilizes a tree and causes it to fall and damage the neighbor’s property.  If root trimming cannot be done safely, it is best to either reach an agreement with the neighbor to share the costs of removing the tree, or to seek a court order that the tree be removed because it is a legal “nuisance.”

If your local power utility is notified that a tree is touching power lines, the utility will send workers to trim the tree back, for the sake of public safety.

            Weeds and Trash

Your CC&R’s may also protect your views and property value from harm due to weeds, trash, and other unsightly items on your neighbor’s property.  For example, many CC&R’s forbid clotheslines, garden sheds, and lawn equipment from being kept outside on any lot within the development.  In addition, California cities and counties all have code enforcement divisions with responsibility for ordering the clean-up of properties with extensive junk, trash, and debris in public view.  Once they receive a written complaint in the proper form, they will investigate to decide if the situation is bad enough for them to order the owner to clean up the property or reimburse the public agency for the cost of clean-up.  If you have no protective CC&R’s and your code enforcement agency does not deem the situation serious enough to get involved, you may still be able to obtain a court order for your neighbor to clean up their property if it is so full of weeds, junk, and trash that it is a public nuisance. 

            Buildings, Fences, and Improper Uses

CC&R’s often restrict the size and type of fences, building additions, and free-standing structures that can be added to lots in the development.  CC&R’s also may prohibit homes from being used for any commercial purpose, which becomes particularly important to surrounding residents when a neighbor’s commercial use of a residential property is an unsightly or noisy one, such a car repair business.

Building regulations and zoning laws also place limitations on fences and structures on residential lots, and zoning laws generally restrict or prohibit commercial activities on residential lots.  Again, your city or county code enforcement division will often take steps to enforce these laws and regulations once they become aware that a violation exists.

California’s Coastal Commission also has long and detailed regulations covering buildings on private property that are in the coastal zone. This is a complicated area of law, and a homeowner who is not in compliance with all Coastal Commission regulations may find that if they complain about a neighbor who blocks their views, the neighbor may retaliate by filing their own Coastal Commission complaint.  For this reason, a lawyer and an architect familiar with coastal regulations should always be consulted before the initial complaint is filed.  

            Spite Fences and Structures

California law forbids property owners from erecting “spite fences” or other structures that are not being used for any purpose other than to block a neighbor’s view.  Although these are rare, it may be possible to obtain a court order requiring the spite fence or structure to be removed by proving the lack of any practical purpose for the fence or structure, and by proving that a long-standing dispute over views or boundaries preceding the building of the fence or structure.

If your views and enjoyment of your property are being impaired by a neighbor’s trees, fence, building, or unsightly use of their property, the skilled real estate attorneys of San Diego Law Firm can help you. We have years of experience in obtaining property owners’ compliance with CC&R’s, California state laws, and local property laws and regulations through negotiation, mediation and court injunctions. We generally start with friendly outreach to seek your neighbor’s cooperation, and only take more formal steps if no cooperative agreement can be reached.  We work to minimize the time and expense of legal proceedings, to get the best outcome possible given the circumstances, and to set up a methodology and lines of communication to help you and your neighbors avoid future conflicts.  For experienced, concerned help with any real estate problem, please call San Diego Law Firm at (619) 794-0243.

Even if the zoning of an area seems obvious (e.g. commercial, residential, industrial, or agricultural), San Diego and other cities often add many more detailed restrictions to each zoned area to control how various pieces of property are used.  Whether you’re building, renovating, buying, or selling real estate, if you don’t have the relevant zoning ordinances researched and analyzed by a competent attorney, you may be setting yourself up for a very costly mistake. 

If it turns out that there’s a conflict between your plans and the applicable zoning laws, there are different options to consider.  Individuals or the government can try to change the zoning laws covering the property, but this requires public hearings and other procedures that may be unnecessary.  Instead, if the change you need is reasonable for the area, a lawyer can apply for a zoning variance for you.  By getting a variance permit, you’re able to use the property differently from what the zoning law requires.  In some circumstances – such as a sudden change in zoning laws that cause your property to be in violation – a “non-conforming use permit,” or other type of permit, or even other type of legal action – may be required.  At San Diego Law Firm, we can determine the zoning and other use restrictions on your property, recommend any type variance, permit, or legal action needed for you to get the most value from your property, and take action to obtain whatever variance, permit, or other legal relief you need. 

Whether you’re a homeowner or developer, we understand the challenges that land use laws can pose to your financial investment.  Meet with San Diego Law Firm’s knowledgeable residential and commercial real estate attorneys for help in obtaining zoning permits and variances and resolving any land use disputes.  Please contact us at (619) 794-0243 for fast, friendly help with all types of land use and real estate problems.

Ruoff vs. Harbor Creek Condominiums

In 1993, the California Court of Appeals decided a case called “Ruoff v. Harbor Creek Condominiums.” The court decided condominium owners could be sued as individuals for accidents occurring in common areas of the development.  A 1993 Los Angeles Times article reported that the condominium owners had argued in the trial court that they couldn’t be sued because of a provision in California law concerning condominiums. That law says “volunteer officers or directors of the association who live in the condominium development are immune from damages,” meaning they can’t be made to pay for anyone’s injuries or financial losses caused by something relating to the condominium development.

The 4th District Court of Appeal in Santa Ana held that this legal provision only applied to volunteers serving on condominium association boards, not to all owners. This means that if all the condominium owners share an ownership interest in the common areas, they can be required to pay for losses not covered by the insurance held by the HOA. Because of this case, the type of additional insurance you purchase for your condominium is very important.

Look to the Master Policy First 

Because different condo complexes require different types of insurance coverage, it’s a good idea for each owner to review the master policy and HOA bylaws.  Individual condominium owners do not own the complex as a whole. Typically, each individual unit owner is responsible for insuring his or her part of the whole. Each condominium complex’s HOA Bylaws specifically spell out what a unit owner owns within the four walls of the unit. Everything else is owned by the condominium association ownership. An HOA usually collects monthly dues from unit owners and uses a portion of the dues to insure the common areas. It then becomes the unit owner’s responsibility to obtain additional insurance for the unit itself and everything inside the unit.

A 2010 MSN Article outlines two broad master policy categories:  “bare walls in” and “all in.”  A “bare walls in” policy covers “all real property from the exterior framing inward but [does] not cover fixtures or installations within a condo unit. Features such as countertops, bathroom and kitchen fixtures, and flooring are not covered.” An “all in” policy covers “fixtures, installations or additions within the interior surfaces of the perimeter walls, floors and ceilings of individual units.” Once you determine what specifically you own and what items are not insured by the master policy, you may then determine how much coverage you will need to insure the contents and structure of your condominium not covered by the master policy.

How Much and What Type of Coverage?

Typically, you can figure out how much coverage you need for possible property damage by finding out how much other owners in the development paid for recent upgrades to their units. When it comes to property-damage coverage, there are typically two types: cash value and replacement-cost coverage. Cash-value coverage replaces the value of the insured item, less any depreciation in value. Replacement-cost coverage pays for the replacement of the item itself without considering depreciation in value. It’s up to each unit owner to decide how much and what kind of property damage coverage would best suit their needs.

Liability Insurance

Lastly, a unit owner may wish to consider purchasing liability insurance for accidents that happen because of their own negligent conduct or because of some defect or problem on their property or in the common areas.  As previously stated, a condominium owner may be held liable for injuries occurring in or on common areas. Generally speaking, the common areas are insured by the HOA, but the owners may become individually liable when the damages exceed the HOA policy limits, making it a good idea for the owner to buy his or her own common-area liability insurance.  It is important for unit owners to consider this possibility when deciding what type and how much insurance to buy.

If you plan to buy a condominium and are unsure about provisions in the HOA bylaws or the HOA master insurance policy, contact one of our experienced real estate attorneys at San Diego Law Firm. We can help you determine exactly what you will own per the guidelines in the HOA’s bylaws, and whether you might be at risk of being held liable for injuries from an accident in a common area because of an inadequate master insurance policy.  Please contact San Diego Law Firm at (619) 794-0243 today to schedule an appointment. We look forward to helping you.

In the small town of Derby Line, Vermont stands a beautiful 110 year old Romanesque-style library. The Haskell Library appears to be a typical Vermont library, but its location is particularly strange. The building sits directly on the border of Ontario, Canada and Derby Line, Vermont. You enter the Library in the United States, but walk to the circulation desk, and you’re in Canada.   

Because of this peculiarity, for many years the Haskell Library enjoyed informal immunity from restrictions on international border-crossing, and people from both countries entered the library by parking and coming through the front door.  However, a recent Seattle Times article reported that crackdowns on border enforcement have changed the views toward letting the Haskell Library slide on international border enforcement.  Now, Canadian citizens have to go through a separate checkpoint before they enter the library.  

Boundaries in Everyday Life:

The above scenario is just one example of how borders and boundary lines can affect the lives of those living near or on them. From a legal standpoint, boundary lines play an important role in property ownership as well. Many homeowners forego having their property surveyed before buying or selling it. This can cause confusion as to where one property ends, and another begins.

Under the assumption that their property extends to a certain point, a homeowner may erect a garden, fence, or other structure on a part of the land they believe is theirs. Unfortunately, in many instances the land is not theirs. This mistaken (or sometimes malicious) encroachment onto another’s land causes frequent headaches in the court system.

There are several actions that may be taken to handle property encroachment. A homeowner who finds that someone has encroached on his property can seek a court order to have the encroachment removed. Or, the homeowner can sell the encroached-upon piece of their property to the encroacher for a fair price, or lease the land to the encroacher for a fair rental value. Whatever action is chosen, it’s important that the homeowner not ignore the encroachment problem.

This is because adverse possession – meaning possession that is openly visible and contrary to the interests of the homeowner – plays a role in boundary disputes. If a person continuously uses a piece of land that is not theirs, for a specific period of time, the law will often permit that person to bring a lawsuit to “quiet title.”  The result can be that an encroacher who pursues a quiet title lawsuit ends up owning a piece of the homeowner’s property. Typically, in these situations the encroacher using the homeowner’s land is also required to pay the taxes and make improvements to that portion of the land.

Because most homeowners do not want to lose part of their property to an adverse possession claim, it is important for them to take action if they suspect someone may be encroaching on their land with a building, fence, pathway, landscaping or other something else.  If you think that your land may have been encroached upon, contact one of our experienced real estate attorneys at San Diego Law Firm. Our attorneys can help you with all boundary line issues and issues arising from neighbors using your land.  Contact San Diego Law Firm today at (619) 794-0243 to schedule an appointment.

The Foreclosure Process in a Nutshell

When a borrower defaults on a loan the lender may seek to foreclose on the property either judicially or non-judicially. In a judicial foreclosure the lender files a court complaint to foreclose on the property.   The borrower can answer the complaint by stating any defenses that might exist.  If no valid defenses exist, the court orders foreclosure, the property is attached, and the property is sold at a public auction. 

In a non-judicial foreclosure the lender records a notice of default with the county recorder.  This makes it a matter of public record that the borrower has not made the mortgage payments.  The lender then obtains the right to sell the property at a trustee’s sale.  The borrower is given a 5-day period to cure any default before the trustee sells the property and records a deed at the county recorders office.  California allows for both types of foreclosures.

Payment Defense

If a homeowner can show that he has made all payments required by the loan agreement, foreclosure is not permitted.  If the lender has improperly rejected payment, the foreclosure cannot proceed.

Lack of Fairness Defense

In some cases, a court may be willing to examine the terms of a loan agreement to determine whether or not they are fair.  Unfair terms, such as terms that result in loan payments that abruptly skyrocket (often found in “Option ARM loans”) may provide a defense to a foreclosure, particularly where the borrower was elderly, uneducated, or did not speak English.

Chapter 13 Bankruptcy

If a person files for Chapter 13 bankruptcy, the Bankruptcy Court can “lien strip” away second and third mortgages and home equity loans. With only the first mortgage to pay, many people find they can then afford to stay in their homes.  In addition, the filing of a Chapter 13 bankruptcy will stop a foreclosure lawsuit.

Call San Diego Law Firm for Foreclosure Help

If you are facing foreclosure and want to keep your home, an experienced real estate and bankruptcy attorney can advise you of your options.  Our team of attorneys at San Diego Law Firm are highly experienced with the process of foreclosure and the options available to homeowners facing foreclosure.  We also have substantial experience in negotiating with lenders.  Please call us at (619) 794-0243 to set up your consultation.

What is a Deed-in-Lieu of Foreclosure?

A deed in lieu of foreclosure occurs when a homeowner voluntarily transfers legal ownership of property to a lender in exchange for the lender’s promise not to foreclose. The primary advantage is that unlike a foreclosure, a lieu of foreclosure does less damage to borrowers’ credit histories.  According to Fannie Mae, a distressed homeowner may be able to qualify for another home mortgage in less time than they would be able to had they gone through a foreclosure.  (However, under the FICO credit scoring method, a deed in lieu of foreclosure is reflected as an account that was “not paid as agreed.”) 

Will a Deed in Lieu of Foreclosure Work If a Foreclosure Has Already Started?

If a homeowner is already facing foreclosure it may be possible for the homeowner to offer a “deed in lieu of foreclosure” to a lender in exchange for the lender’s promise to stop foreclosure proceedings. 

Have a Team of Experts Ready

As with any decision that will have an impact on your tax liability and estate plan, it is best to consult an experienced real estate attorney to discuss the possible consequences — both positive and negative — of any alternative to foreclosure.  The process of a deed in lieu of foreclosure may require that a borrower hand over a written agreement expressly stating that the transfer is made voluntarily. Also, while a lender may accept a deed in lieu of foreclosure, income taxes may have to be paid on the amount that the lender is not able to recover after the lender sells the home.  It may also be possible to negotiate the terms of the deed in lieu of foreclosure transfer in a way that is actually favorable to a homeowner.  For example, Bank of America is not only soliciting distressed homeowners, but in some cases is offering cash incentives.  A very recent Los Angeles Times article cited some incentives as being as much as $15,000, a lot of money for a homeowner who need a fresh start.

Because California law limits the extent of services that can be provided by so-called “foreclosure consultants,”  a homeowner who faces foreclosure is best served by working with a seasoned real estate attorney who is familiar with the process and has a network of industry experts to step in where needed.  If you are facing foreclosure, the real estate attorneys at San Diego Law Firm can carefully evaluate your situation and help you obtain whatever option is both open to you and workable for you.  That may be a deed in lieu of foreclosure, a Chapter 13 bankruptcy plan that allows you to keep your home, or negotiations for a delayed foreclosure, cash incentives, or other favorable terms in giving up your home.  Please call us today at (619) 794-0243 for an appointment.

What Is A Reverse Mortgage And Who Qualifies?

A reverse mortgage is a loan.  As a borrower, you receive a certain amount of money based upon the equity that you have built up in your home, either as a line of credit or as fixed monthly payments for life, or for as long as you live in your home. The proceeds of the loan are tax-free, and you can spend the money on anything.  However, there are two important factors that must be met to qualify for a reverse mortgage. First, as a borrower, you must be at least 62 years of age and hold title to your home.  Second, your home must be paid off in full, with no outstanding mortgage due, and if it is not you must use part of the reverse mortgage money to pay off the existing mortgage. 

Is A Reverse Mortgage “Free Money”?

While a reverse mortgage provides a borrower with disposable income, which can be used for a number of purposes, it is still a loan that has to be paid back – it is a loan with a maturity date!  Usually, the loan balance becomes due when the last remaining borrower passes away.  And usually the loan is repaid through the sale of the house when the borrower dies or moves into an assisted-living facility.  But in some circumstances, the due date arrives because the borrower fails to pay property taxes or fails to keep the home insured, and either situation can result in foreclosure. 

The Double Edged Sword:  How A Reverse Mortgage Can Avoid Foreclosure And Lead To One

Consider the case of Ruby Clark.  In the AARP article, “An Escape Route for Foreclosure,”  Ruby Clark’s experience demonstrates the saving grace a reverse mortgage can provide for some homeowners.  Ms. Clark was the unfortunate victim of a subprime loan that she took out to help her maintain the home she had lived in for over 30 years.   When she could not keep up with her payments, her home was headed for foreclosure. An attorney with the local Legal Aid Society persuaded the mortgage company to agree to a mortgage pay-off  of less than what was owed, and Ms. Clark then took out a reverse mortgage. She was able to use those funds to pay off the existing mortgage debt with some money to spare. In Ruby’s case a reverse mortgage saved her home. 

However, according the legislative policy director for AARP, there is increasing risk for people who take out reverse mortgages due, to the strict policies being adopted by mortgage giants like Fannie Mae.  According to a recent Los Angeles Times article, the Federal Housing Administration, which runs the reverse mortgage program, is clamping down on borrowers who are delinquent in paying their property taxes or who fail maintain property insurance.  A reverse mortgage borrower who doesn’t have the ability to pay their property taxes or pay their insurance premiums may face foreclosure.  Before you decide that a reverse mortgage is for you, you will want to fully understand the benefits and risks.

Our Real Estate and Estate Planning attorneys at San Diego Law Firm can help you evaluate all the alternatives if you are considering taking out a reverse mortgage.  We can take your reverse mortgage into account in updating your living trust and estate plan and planning for Medi-Cal.  And if you have an existing subprime mortgage, we may be able to negotiate with your lender to reduce the amount owing so that you can pay it off with a reverse mortgage. For more information or an appointment, please call us at 619-794-0423.  We look forward to helping you.

What is a Short Sale?

A “short sale” in real estate refers to a sale of real estate that falls short of the loan balance owed on the mortgage. When a property is sold in this manner, the lender allows the property to be sold for an amount less that what is owed to them.  Under a short sale the lender may agree to “write-off” the difference between what remained on the loan balance and what the property actually sold for. It does not necessarily guarantee that the difference will be forgiven by the lender; instead, this is something that has to be negotiated with the lender.

What is a Foreclosure?

A “foreclosure” is a proceeding that allows a lender to end all ownership rights when the owner of a property stops making mortgage payments and is in default. Basically it allows the lender to reacquire the property. While each state is different, in California the lender generally has a right to pursue a property owner for the deficiency owing after the foreclosure has taken place.  This means that if your property is not sold, or the purchase price was not enough to cover the balance on the loan, the lender can turn the loan over to debt collectors, or sue you for the balance still owing, and/or pursue payment from you even if you file for bankruptcy.

However, there is an important exception to this rule:  the lender has no right to collect a deficiency from you if the loan was used for the original purchase of your primary residence, and you still live there.  If you refinanced your home, or if the loan was for a second home, commercial property, or investment property, this exception does not apply.  

Why a Short Sale May Be a Better Option for a Distressed Homeowner

There are a number of reasons that a short sale may be in the best interest of a seller who needs to let go of a property.  One important advantage to a short sale pertains to future home purchases.  For example, Fannie-Mae, the Federal National Mortgage Association, adjusted their guidelines in 2008 to allow an individual that successfully completes a short sale to be eligible for a Fannie-Mae baked mortgage package after only two years.  In contrast, an individual who loses their home to a foreclosure will not be eligible for a Fannie Mae backed mortgage for five years.

Another advantage to a short sale would be in the area of credit score issues.  The impact of a foreclosure can be a downgrade of your credit score anywhere from 200 to over 300 points, and it will affect your score for a minimum of three years.  However, the impact of a short sale on your credit score can be as little as 50 points and its effect can be as brief as 12-18 months.

How to Start a Short Sale

If you think you might be interested in short-selling your home or other real estate, it is best to talk to a legal expert about the process and related legal issues, such as potential tax consequences to you when part of your mortgage loan is forgiven.  The skilled real estate attorneys at San Diego Law Firm have specialized experience in handling short sales as well as a unique knowledge of the real estate market.  To schedule a consultation, please call San Diego Law Firm at 619-794-0243.