Short Sales in Real Estate Transactions

To better understand the sale transaction in real estate, there are some terms that are commonly known but not properly understood. Short sales and foreclosures are two terms you should know the most profound is that the general knowledge of real estate transactions.

What is a Short Sale?

There seems to be a ton of confusion as to what to do with the 1099A  after you got rid of your mortgage home loan. That you more or less did by losing your home at the same time in the form of a foreclosure or a short sale.  Not to mention the 1099C that you may get as well. So hopefully this will clear it up a little.  But when you do get your forms do save them and do bring them to your tax advisor to see how they may help you filing them correctly.  There are a ton of homes in the Santa Maria real estate market just like many other markets where the homes ended in foreclosure or a short sale.A 1099A hopefully followed by a 1099C is what the previous home owners would be getting.But please understand that this blog is only informational and for specific situations you need to consult your tax preparer.

A short sale occurs when a lien holder for the property agrees to a reduction in the property lien or loan to progress a real estate sale. A potential buyer of this property has the opportunity to purchase the property at a reduced sum. A short sale of a property is an alternative to allowing a homeowners property to be foreclosed.

How Does a Short Sale Work?