Why should I use the Battiata Real Estate Group?

Answer: Because we will do the most effective job at marketing your property (remember, we have to generate offers from qualified buyers & sell your property) and we are among most experienced and the most effective short sale negotiators in the United States.

We have assembled a team that includes former underwriters from major national lenders, as well as a staff of experienced, dedicated, professional employees who negotiate and close short sales every day. We have done successful short sales with every lender that loans money in the state of California, and we have completed more successful short sales than… Read More >>

Can any agent do a short sale?

Answer: Absolutely not. Many agents have no interest in doing short sales because they require a tremendous amount of time and expertise, and if you do not know what you are doing, they often go to foreclosure and then the agent does not get paid. If an agent is not extremely experienced at doing short sales – in other words they have done at least 50 of them successfully in the past 2 years – then I would not use them.

Lest you think I am simply trying to toot my own horn, this site gets visitors from all over… Read More >>

Should I file bankruptcy? Will it allow me to keep my home? I’ve heard the lender cannot foreclose if I file bankruptcy.

Answer: There are 2 types of bankruptcy commonly used by individuals – Chapter 7 (“Fresh Start”) and Chapter 13 (“Wage Earner”). Chapter 7 can enable individual filers to wipe away debts such as credit card and medical bills so they can continue to make their mortgage payments.

Chapter 13 involves setting up a 3-5 year repayment plan to repay your debts. Chapter 13 requires that you are earning a steady income, as you will be repaying all of your debt. Both have a very negative impact on your credit and remain on your credit report for 10 years.

Because of… Read More >>

Who will be negotiating my short sale with the bank? Do you do this in your office or do you sub it out to an outside company?

Answer: Our short sale team consists of nine professional staff members here in our Southern California offices. You are welcome to come in and meet with us in our office, meet our team and get a first hand look at our systems. Among our staff are 3 former underwriters from major national lenders. We have negotiated 100’s of successful short sales and handle every aspect of the short sale process ourselves. We do not farm any part of the negotiations out to an outside company and recommend you be extremely skeptical of any agent or attorney who uses an outside… Read More >>

Do I need to hire an attorney to do a short sale?

Answer: It is our belief that you will be best represented in a short sale by a competent, experienced real estate agent who works every day in the real estate business, will market your property aggressively in order to attract buyers, and who is experienced at doing short sales and negotiating with lenders. In our view, an “experienced short sale agent” is one who has done at least 100 successful short sales in this downturn cycle (i.e. since 2006).

If you have questions about the tax implications of a short sale, we recommend you seek the advice of a qualified… Read More >>

Do I need to be behind on my payments to do a short sale?

Answer: No. This is a common misconception. You do not need to be behind on your payments or have been late on a payment to do a short sale although lenders are sometimes more motivated to do the short sale if you are not making your payments.

How long will a short sale take?

Answer: The short sale process typically takes about 4 months, start to finish. It can take longer depending on how backlogged the lender is. You can live in the property for the entire duration of the short sale or you can move out whenever you wish.

How much will a short sale cost me?

Answer: A short sale costs the seller nothing – the lender pays all closing costs, escrow fees, commissions etc. The lender may also pay any outstanding property taxes.

Are there any advantages to letting my home go to foreclosure vs. doing a short sale?

Answer: I have yet to hear a coherent argument for letting your home go to foreclosure vs. doing a successful short sale. Depending on whether you have a recourse or non-recourse loan, when you let your home go to foreclosure you either run the risk of being liable for the deficiency amount or liable for the income taxes on that loss.

Secondly, your credit will drop up to 400 points and you will not be able to buy a home or get any decent credit for up to 7 years.

Compare this with a short sale, in which the lender… Read More >>

What are the advantages of a short sale vs. letting my home go to foreclosure?

Answer: The primary advantage to doing a short sale vs. walking away and letting your home go to foreclosure is that in a short sale the debt is settled and you no longer owe the bank any money. If your home goes to foreclosure, you may still be liable for the deficiency in the event that the bank files a judicial foreclosure.

A secondary (but still very important) advantage is that in a short sale, your credit takes much less of a hit compared to a foreclosure. The impact on your credit will vary depending on how established your credit… Read More >>

What is the difference between a recourse and a non recourse loan?

Answer: A purchase money loan is considered to be a “non recourse” loan, while a loan that has been refinanced is considered to be a “recourse” loan.

In the event of a foreclosure, the lender can pursue a deficiency judgement (pursue the seller for the money they lost in the foreclosure) on a 2nd lien that is a recourse loan (has been refinanced).

In a short sale, thanks to CA SB 458, lenders cannot pursue any deficiency after close of escrow regardless of whether the loan is recourse or not.  In a short sale, all debt is “settled.”

What if I have a first and a second loan on my property with 2 different lenders (or the same lender)?

Answer: Most people that we do short sales for have a first and a second loan, often with 2 different lenders. For the short sale to reach a successful close of escrow, both lenders have to approve the short sale and agree to settle the debt.

It is important to note that both lenders have a vested interest in doing this. The lender with the first loan does not want to foreclose, and therefore is willing to give a little money to the second in order to get them to agree to the short sale.

The second lender will get… Read More >>

Can my lender go after me for the money it loses in the short sale?

Answer: No.  With the passage of CA SB 931 & CA SB 458, lenders cannot pursue any deficiency judgement after a short sale.  All debts are considered settled “Full & Final” after a short sale in California.

Will I have to pay CA state taxes on the money my lender writes off in the short sale?

Answer: As of April 12, 2010, California has passed its own version of the federal Mortgage Tax Debt Relief Act. It is Senate Bill 401, The Conformity Act of 2010, which conforms to the federal law described in detail above, but applies to California state income taxes on a short sale. It allows taxpayers who had all or part of the loan balance on their principal residence forgiven by their lender to exclude the forgiven debt from California gross income.

We recommend you review your specific tax scenario with your CPA or accountant and have them answer any tax… Read More >>

Will I have to pay federal taxes on the money my lender loses in the short sale?

Answer: There are several different scenarios with regard to whether or not you will owe federal income taxes on the loss the lender takes in a short sale.

When you do a short sale, your lender is agreeing to settle the debt on the property for less than the amount they are owed. The IRS therefore allows them to write off this loss, which is why your lender will send you a 1099-C after the short sale.

The IRS considers “debt relief” to be income for tax purposes. In other words, if your lender writes off $50,000 on your short… Read More >>

How will a short sale affect my credit?

Answer: This is a great question as there is a lot of misinformation on the internet about this topic. A short sale is recorded on your credit report as “debt settled for less than the amount owed”. This typically will result in a relatively minor hit on your credit compared to a foreclosure or late payments on your mortgage. I say ‘”typically” because it affects everyone’s credit differently. The more established your credit, the less of an impact it will have on your score.

The reason you often hear and read that a short sale will drop your credit 100… Read More >>

How will I know if I will qualify for a short sale?

Answer: Call our office and we can tell you over the phone whether you will likely qualify. We have former underwriters from major national lenders who work in our office on our short sale team. The overwhelming majority of our clients are approved for a short sale because 1) we know how to submit the short sale package in such a way that the lenders will approve them and 2) we have a tremendous amount of experience with short sales and negotiating with the lenders.

What is a Short Sale?

Answer: In a short sale, the lender agrees to settle the debt owed on the property for less than the full amount. “Settled” means that the lender is writing off the debt (which is why you get a 1099 after a short sale for the amount of debt forgiven) and that they are not going to go after you for the money they lost by filing a deficiency judgment in the future.