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In difficult foreclosure situations, a short sale may be an excellent option to avoid foreclosure, eviction, and further credit damage. A short sale is when a bank or lender agrees to let a homeowner sell their property for less than the full amount owed on the mortgage. The homeowner avoids foreclosure and is relieved of all liability on that mortgage once the short sale is complete, but there are serious legal and tax issues to be addressed in the process.
Before considering a short sale, a homeowner will want to make sure they have a reliable and trustworthy professional representing their interests. At Lawyers Realty Group, you will have an Attorney/Realtor® by your side from the start to protect all your interests. A homeowner must have both legal and real estate representation for a short sale.
Are there legal and tax issues involved in a short sale?
The short answer is YES.
A short sale is a legal settlement of a breach of contract (i.e. the mortgage default). This legal settlement resolves the mortgage default but triggers potential tax liability.
Short sales require legal negotiations which can only be conducted by an attorney/realtor. California law prohibits a non-attorney realtors from conducting these negotiations. Having an attorney/realtor allows for all matters to be properly and legally resolved with no “loose ends” popping up after the real estate sale concludes.
Are real estate agents allowed to analyze and negotiate my legal and tax liabilities?
NO, absolutely not.
Only an attorney/realtor can analyze and negotiate legal and tax liabilities in your short sale. A non-attorney realtor is not allowed to give legal or tax advice.
Even if that realtor has an attorney associated with the brokerage, that attorney does not represent the homeowner, they only represent the real estate brokerage. Those attorneys are not looking out for your best interest and would be unable to give you legal advice.
Can a real estate agent take legal action if my short sale is denied and I’m facing foreclosure?
NO, absolutely not.
Only an attorney/realtor can take legal action on your behalf. A non-attorney realtor cannot make legal threats or bring legal action whatsoever.
In desperation, those realtors may try to pawn you off at the last minute to a bankruptcy attorney to try to save their commission, but that comes too late to properly protect you. An attorney/realtor can bring legal action to protect you, and Lawyers Realty Group provides this service without cost to the homeowner.
Can a real estate agent review and discuss my bankruptcy options?
NO, absolutely not.
It is illegal for a real estate agent to discuss and review your bankruptcy options. Filing a bankruptcy at the wrong time can actually worsen potential tax liabilities. It is critical that you have an attorney/realtor analyze this option BEFORE signing any listing agreement or concluding any transaction.
Can a real estate agent review and discuss my other liens and debts?
NO, absolutely not.
A real estate agent cannot analyze your legal liabilities and options to address junior liens or other collection matters. Only an attorney/realtor can review the legal exposure you face and propose proper legal actions to address those debts.
Check out our complete short sale guide here.
What Can an Attorney/Realtor Do?
Having an attorney/realtor for your short sale gives you the short sale advantage and is the only viable option to protect your interests. An attorney/realtor is able to analyze and resolve all your legal and tax issues while also providing for all your real estate needs.
Additionally, an attorney/realtor will provide the best protection during the short sale. This way, you can stay in your home past any scheduled foreclosure date while the short sale is being processed.
Worried About the Cost?
That’s the best news — at Lawyers Realty Group you will never pay anything out of pocket for the full protection of an attorney/realtor. The short sale lender pays all costs and fees in the short sale.
Don’t limit your protections in a short sale by using a non-attorney Realtor. Get the full protection you deserve without paying anything out of pocket. Contact our offices today for a free consultation today — (949) 264-0966
