Fort Lauderdale Short Sale Lawyer

South Florida Debt Relief Attorney Advising Clients About the Pitfalls of Short Sales and Short Refinances

Falling behind on mortgage payments is something no homeowner ever believes will happen. That is, until one of the homeowners loses his or her job or until adjustable rate mortgage interest rates skyrocket, making the monthly payment unmanageable. Unfortunately, due to the current housing market most homeowners in Florida have an underwater mortgage and are incapable of selling their home. Some homeowners attempt a short sale — selling property for less than it is worth — in order to escape underwater property and get a fresh start.

Short sales are pursued by hundreds of homeowners each month in Broward and Palm Beach counties. Unfortunately, many of these short sales will not go through due to the lender's unwillingness to approve the sale or, more importantly, forgive the deficient balance of the mortgage after the sale.

Are you considering short-selling your home? Many people fall into the trap of selling their home in a short sale or pursuing a short refinance without truly understanding the process or the likelihood that it will fail. It is important to have a clear picture of the options available and have experienced representation throughout the legal process. If you are considering a short sale or short refinance in Florida, contact our Fort Lauderdale short sale attorney at The Law Offices of Sherri B. Simpson. We can discuss your options in a free initial consultation.

Some of the options homeowners in Florida are considering include:

• Short sales: The borrower sells the property for less than it is worth and requests that the lender forgives the remaining balance of the loan.
• Short refinance: The lender approves a reduction in the mortgage when the borrower is in default and facing foreclosure on the merits that the borrower will be capable of managing the reduced mortgage obligation and regular monthly mortgage payments will continue. (While short sales generally do not appeal to lenders, most lenders prefer short sales or foreclosure to short refinance.)
• Short payoffs: The borrower sells the property for less than it is worth and signs a promissory note with the lender agreeing to repay the remaining balance of the loan over a repayment period. (This is an uncommon option that is rarely approved by lenders.)

Dispelling Short Sale Myths and Misconceptions

There are countless misconceptions about bankruptcy, mortgage foreclosure and short sales. Many people believe that a short sale is advantageous because it ends debt problems, stops home foreclosure and avoids the credit damage that people face in bankruptcy. However, there are more myths in this statement than truth. Reality:

• A short sale rarely deals with all of an individual's debt problems.
• A short sale only stops foreclosure if it is successfully approved by the lender.
• If a short sale proceeds without lender approval, the homeowner can face liability for the deficient balance of the loan.
• A short sale will appear on your credit history.
• A short sale can result in further debt problems if it is not completed correctly, such as liability for misconduct of others (including misconduct of a real estate agent).
• Homeowners who are successful in discharging debt in a short sale will likely face tax liability — bankruptcy does not result in this tax burden.
• Unlike a short sale, bankruptcy is an effective tool that can deal with the whole picture and can stop credit problems from getting worse.
• Bankruptcy petitioners are capable of restoring credit and owning a home.

Talk to a Fort Lauderdale and Coral Springs Attorney About Short Sales or Short Refinance

Short sales are confusing, lengthy (lasting on average between eight and nine months, and even longer) and can result in significant liability if they are not handled under the advice of an experienced lawyer. Most people are unaware of the contents or effect of the documents they sign until it is too late. Oftentimes, short sales proceed without lender approval or worse — without the lender stating that the deficient balance of the mortgage will be discharged.

If you are considering a short sale or short refinance, it is important to speak with an experienced attorney first. When you come to The Law Offices of Sherri B. Simpson in a free consultation, we can review your situation, explain your rights and discuss your options. We can provide you with up-to-date information about a strategy that is right for you. Simply hiring a lawyer to review documents now — before you sign anything — can help you avoid liability and save you thousands in legal fees in the future. Contact our law firm to arrange your free confidential consultation with an experienced bankruptcy and debt relief attorney.

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We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.