Florida Home and Mortgage

Although it’s not at the top of the priority list when facing a foreclosure, buying a new home in the future can be next to impossible with a foreclosure or a deed-in-lieu on your record. Any house loan you apply for over the next 7 years will be negatively affected by the foreclosure. When applying for a conventional loan you must disclose that you had a foreclosure. You aren’t even allowed to apply for a conventional loan for a minimum of three years after the foreclosure is recorded. Even then, you will still face a higher interest rate just like the conventional.

However, you do have an option that allows you the ability the issues mentioned above, a short sale. Short Sales are when the bank agrees to allow you to sell the house for less than you owe. If you are like many homeowners in South Florida and owe almost double what your house is now worth, there will be many benefits for you by doing a short sale. If you allow a short sale expert to negotiate your short sale with the bank, you may even be able to avoid a deficiency judgment, which is the difference between what you owed on the house and what you sold it for. Even if this is an investment property you may also be able to avoid being taxed for the debt forgiven under the Debt Relief act of 2007. To make sure this applies to you, you should speak with an accountant.

Even though there are more important matters to address while facing a foreclosure, if you choose to allow your home to be foreclosed, there is no guarantee that home prices will be as low a level as they are now once you are able to afford a home again. No one can project what they prices will be like in 5 or 10 years, but how low do you think the prices can slide? Once they stabilize, prices will increase.

If you plan on owning a home again in the future, and want a decent interest rate on your mortgage, short sales are an excellent choice.

Click Florida foreclosure help for more information on foreclosure help including more information on Short Sales.