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Understanding Short Sales

As foreclosure rates hit record levels, more sellers are turning to short sales as a way to avoid foreclosure. So, how does it work?

In a short sale, the seller arranges with their mortgage lender to accept a price that's less than the amount they owe on the property. As part of this arrangement, the lender typically agrees to forgive the rest of the loan. As a result, the seller doesn't have to go trhough a foreclosure, the buyer picks up a property at a discount, and the lender avoids taking on the burden of unloading the property.

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First-Time Home Buyer Tax Credit

For aspiring home owners who find their goal stubbornly elusive, newly enacted legislation providing a tax credit of as much as $7,500 for first-time home buyers might just be the opportunity of a lifetime.

But like so many of the good things in life, time is of the essence for buyers who want to take advantage of this outstanding opportunity. Only homes purchased on or after April 9, 2008 and before July 1, 2009 are eligible. Use the links below to learn more about the tax credit.

Source: federalhousingtaxcredit.com

Who Benefits from a Short Sale

For home sellers who owe the lender more than their home is worth, it's not as bleak as it might sound. Negotiating a short sale with the lender could be the solution.

This means the seller or the seller's agent sells the home to a buyer at market, or slightly below market value, and the lender agrees to accept the proceeds as payment in full on the mortgage, even though the sales price is less than the existing encumbrances.

The downside is lenders are not required to negotiate discounted payoffs, and there is no guarantee your lender will let you do a short sale.

Short Sales Florida