San Diego Housing Inventory at Low Numbers

Where did all those Home for Sale signs go? They’ve become scarce in San Diego County, leaving home buyers in a competitive situation that few anticipated.

In cities like San Diego, the “buyer’s market” is a thing of the past. Homes are selling faster than they’re coming on the market, and those who seek to get an under market value bargain are finding themselves shut out.

Serious San Diego home buyers need to confine their search to the price range they can afford; then work with an experienced buyer’s agent with a good reputation in the real estate community.

We fit that description.

What difference does the agent make? All the difference.

First, we know what our buyers can ask for safely and what will lead to an automatic rejection. Then, we know how to negotiate in a manner that keeps the lines of communication open – thus leading to an agreement.

Next, your agent’s reputation will be a factor when the listing agent presents multiple offers to the home seller. Our offers are looked upon favorably because listing agents know our buyers either have the cash or have been pre-approved for their mortgage loan. They also know that we’ll do our share of the work while behaving in a professional, pleasant, and cooperative manner.

Other San Diego County agents know us and know we deliver results for our clients.

If you’re ready to own a San Diego home, get in touch. You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.

Thinking of selling your San Diego home?

Your first question is probably “What is my home worth in today’s market?”

To get an instant estimate, just CLICK HERE. Once you enter your address and verify a few details, an estimate of your home’s value will be on it’s way to your inbox.

Then when you’re ready for a more precise market analysis, get in touch. We’ll be glad to prepare an in-depth market analysis.

Zombie Foreclosures – an Endless Nightmare

Are you still liable for the house you lost through foreclosure?

Are bills for water, sewer, HOA dues and property taxes accruing right now – in your name? Is the City preparing to sue you for letting the yard become overgrown and littered?

If yours was a zombie foreclosure, the answer is yes.

Zombie Foreclosures are one more reason why a short sale is the safest course of action for underwater San Diego homeowners who can no longer keep up with mortgage payments. A short sale the only option that is absolutely over when it’s over.

Here’s what happens in a Zombie foreclosure…

Homeowners who let their homes go into foreclosure often move out after the bank notifies them that the auction date has been set. They assume that on the date specified, ownership will have transferred from them to their lender. Unfortunately, that isn’t always the truth.

Banks do what they believe to be in their own financial best interests – without regard to how their actions will affect homeowners.

That’s why banks, in their quest to avoid costs, sometimes do not complete the foreclosure process. Instead, they postpone the auction date. That lets the bank off the hook for property taxes, city services, and homeowners’ association dues. It also absolves them of responsibility to maintain the house and grounds in keeping with neighborhood standards.

In the $25 billion settlement with the state attorneys general in 2012, the nation’s five largest mortgage lenders agreed to inform borrowers of any decision to forgo or delay a foreclosure. But they don’t always adhere to that promise, and homeowners don’t always read their mail.

And therein lies the nightmare.

Thousands of homeowners who believed that they no longer had any legal interest in their homes are now being presented with bills from cities, counties, and homeowner’s associations – where property taxes, water and sewer services, and dues have not been paid since the homeowner moved away. In some cases, where an abandoned home has been vandalized and/or the properties have been left to the forces of nature, cities are also looking to the homeowner of record to make repairs, clean up the yards, and bring the homes up to neighborhood standards.

It gets worse…

In other cases, the banks take title, then simply don’t do the paperwork correctly. So while the former homeowner believes they’ve been cleared of the debt through the foreclosure, the banks are still reporting to the credit bureaus, claiming thousands of dollars still due and owing. The result is that no matter how well that homeowner has taken care of bills since the foreclosure, their credit scores remain in the gutter.

A second problem rears its ugly head when former homeowners are hit with judgments against them for the 2nd and even 3rd liens against the property. Banks don’t have to take immediate action when they decide to collect, so it could be 2 or 3 years before that former homeowner realizes that his or her secondary liens were not wiped out by the foreclosure.

What’s the solution?

If your home has already been foreclosed upon, check with your county tax assessor’s office to see whether they still show you as owner. Also check with your homeowner’s association to verify that ownership has legally been transferred to the bank. If not, call us for further assistance to determine the outcome. We have access to software and data that is more up to date than the public data banks.

If you’re underwater and behind on payments right now, choose the only SAFE solution: List your San Diego or San Diego County home as a short sale.

The short sale process will absolutely transfer ownership from you to your buyer. In addition, none of your lien holders will be allowed to sue you for a deficiency. When it’s over – it will be over.

You won’t suddenly – 2 or 3 years down the road – find yourself facing Zombies.

You’ll be able to get on with your life, begin rebuilding your credit, and purchase a new home within 2 or 3 short years.

So if you’re behind, call us today. We’ve helped thousands of San Diego homeowners avoid foreclosure – and we’d like to help you too.

You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Loan Modifications: The big promise / the even bigger disappointment

HAMP Loan Modifications are a prime example of promises broken.

When HAMP was created in 2009, it was expected to help up to 4 million homeowners avoid foreclosure within the first several months. It has fallen far short of expectations.

Meanwhile, from 2007 through mid-2016, more than 18 million homes in the U.S. were foreclosed upon.

Lenders servicing loans owned or guaranteed by Fannie Mae or Freddie Mac are required to participate in the HAMP program. However, the program has been plagued by servicer non-compliance and complete lack of enforcement.

The government promises a financial incentive for servicers who assist homeowners with loan modifications. However, the financial incentives that encourage them to pursue foreclosure are often more appealing.

In addition, HAMP only requires modification of loans which meet the net present value test. This test determines whether the modification will or will not save the investor’s money. If they determine that foreclosure is more profitable, the permanent loan modification will not be granted.

But they take their time in making this determination.

As a result, homeowners who hope to save their homes through a loan modification are often strung along for years, submitting and re-submitting documents, then sometimes being granted a trial modification. All too often, months of making trial modification payments result in a final verdict of “no,” and the house is taken in foreclosure.

Sadly, lenders know from the outset which modifications will be turned down. It’s a simple matter of plugging the numbers into a computer program. We have that program in our office and can tell homeowners within minutes whether pursuing a loan modification is worthwhile.

Private loan modifications report higher numbers, with more than 4.5 million loans modified over the same period of time. Called proprietary loan modifications, these are “in-house” plans that can vary greatly from one situation to the next. Some have adjustable terms that can increase payments in the future. Others have profit sharing terms that bring immediate relief and promise repayment to the bank if there’s a profit on an eventual sale.

Principal reductions are not usually the reality.

Statistics show that principal was reduced in only 17.1% of all loan modifications. In 77.2% the interest rate was reduced, while other modifications simply extended the terms of the loan. One woman reported a less than 10% drop in her payment amount – but an extension from 23 years to 40 years left on her loan.

In more than 10% of the modifications, the monthly payment was not reduced. Actual reductions in monthly payments ranged from zero to as much as 35%.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

If you have a home to sell in San Diego, today’s market is good news.

Right now, the demand for homes in San Diego is strong, and correctly priced homes are selling quickly.

Because the supply of homes for sale in San Diego is at far lower than normal levels, we’re seeing fifteen or twenty buyers competing for each home priced at market value – and many of those buyers have cash in hand. As a result, San Diego homes are now selling at or above their listed price.

In a balanced market, homes typically sell for 95% to 98% of list price.

If you owe more than your house is worth in today’s market, now is the time to short sell.

Consider these facts:

  • If you offer your house as a short sale now, you’ll have good offers to choose from. You’ll spend less time negotiating with a buyer; and when you present your lender with a solid offer from a well-qualified (or cash) buyer, you’ll increase your chances of getting a speedy and positive response.
  • Getting this over and done with now will free you to get on with life – and within 2-3 years you’ll be eligible for a new mortgage loan. (If you let the house go into foreclosure, you’ll wait for 5-7 years.)
  • The sooner you close this chapter, the sooner your credit profile will recover.

What can we expect in the coming months?

We have no way of knowing. However, prices have continued to rise in San Diego over the past 4 years.

This is a situation that equity sellers should also consider carefully as they weigh their alternatives.

  • The current market presents a unique opportunity for move-up sellers. Due to the law of percentages, selling a mid-range home to purchase a high end home means “losing” a little to gain a lot.

If you’d like to learn your home’s value in today’s market, or if you have questions about short sales, please call 619-929-1413 or write td@tomdunlap.com.

We’ll be glad help…

P.S. Are you SURE you need a short sale?

The San Diego real estate market is changing rapidly, so your home that was underwater last year may no longer be underwater.

To get an estimate of your home’s current value, just CLICK HERE to get an instant estimate.

Then call 619-929-1413 or write td@tomdunlap.com to request a detailed market analysis.

There just might be good news in your future…


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

*Source: www.zerohedge.com

Loan Modifications – The First Step Breaks Homeowners’ Hearts

Most homeowners who want to keep their homes have one thing in common: They’ll do almost anything to keep from missing a mortgage loan payment.

They’ll do without things, sell their toys, go deeply in debt on their credit cards, and even borrow from family members rather than default on that loan.

So the first step toward loan modification is heart-wrenching as well as financially dangerous. That first step is to stop making payments.

This, the banks say, is the proof they need that you are unable to meet the current payments. It verifies your hardship and makes you eligible for modification.

Unfortunately, it’s also the reason they sometimes use for denying a permanent modification. That is just one of the reasons, however. Some are denied because the bank decides they don’t have enough income to make the reduced payment (even as the homeowner has been faithfully making the payment). In other cases, homeowners were turned down because they took a second job to make ends meet and now their income was a few dollars too high. Another woman, after 3 years of submitting paper after paper after paper, was turned down because she didn’t file the right paper.

The greatest tragedy in the loan modification scam is the emotional and financial toll it takes on entire families.

It’s common for homeowners to struggle for 2, 3, or even more years to try to achieve a loan modification. During this time they’ve been shifted from one asset manager to another – and have been required to re-submit documents over and over again. And all this time they don’t know whether they’ll be successful or not.

When at last they’re granted a trial modification, they’re offered hope. In just 3 months they should be granted a permanent modification and life can get back to normal. But no. Even though the guidelines call for just 3 trial payments, they’re often told that there’s a delay – but keep making those trial payments.

One gentleman said he paid 14 trial payments before Chase decided he didn’t have sufficient income to continue. His attorney is filing a legal challenge.

And he is not alone. According to a lawsuit filed against JPMorgan Chase, the bank has “extended, delayed and otherwise hindered” the mortgage modification process in thousands of California cases. The nonprofit Housing and Economic Rights Advocates, who filed the class action suit, contend that the bank has profited from payments borrowers make in temporary modification payments. Then they foreclose.

A spokesman for the group says there’s a dark motive behind this behavior. JPMorgan Chase purchased Washington Mutual loans for pennies on the dollar. They could easily afford to modify these loans and still make windfall profits – but the profits from foreclosure are even greater.

And of course, Chase is not the only bank stringing people along. Complaints about Bank of America, Wells Fargo, and others are rampant on the Internet.

One Bright Spot…

Fannie Mae has recently announced that borrowers and their real estate agents can escalate problems with loan modifications and short sales directly to Fannie Mae, bypassing the asset managers.

We have yet to learn whether escalation leads to success, but it seems like a step in the right direction.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Fannie Mae to Allow On-time Borrowers to Walk Away… Should You Sign a Deed-in-Lieu?

If you’re an underwater California homeowner, the answer is probably “No.”

In California, you’re far better off to choose a short sale. Here’s the real story…

At first glance, the Announcement that starting in March 2013 Fannie Mae and Freddie Mac would let borrowers who are current on their payments sign a “mortgage release” and “wipe out their debt,” sounds good.

But keep reading. While the announcement says they’ll allow on-time borrowers to walk away from their underwater mortgage debt, it goes on to say that only certain homeowners will be eligible. You must first show a valid reason why you need to move. This could be illness or a job change.

And while they use the words “wipe out the mortgage debt,” that only applies to borrowers without financial reserves – and without second mortgages.

Borrowers can be required to pay up to 20% of their financial reserves to help make up the shortfall – or be required to sign a promissory note for future no-interest repayments.

In addition, the second lien holder can demand payment before releasing its lien.

And, since the mortgage release is simply a deed-in-lieu transaction, and will report to the credit bureaus just as if you went through a foreclosure, it’s a pretty hollow victory.

In California, if you short sale instead of waiting for a foreclosure or signing a deed-in-lieu, none of your lien holders can demand payment for the shortfall.

Our opinion: If you’re a California homeowner with financial assets and/or a second mortgage, you’ll be far better off to short sell the house. You may need to have a few late payments show on your credit report, but you’ll actually walk away free from that mortgage debt. In addition, you’ll be eligible for a new mortgage loan 3 to 5 years sooner.

We have the experience and the negotiating expertise to get your short sale closed. So before you risk your financial future, give us a call. You can reach us by writing td@tomdunlap.com or by calling 619-929-1413.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

How Insolvency Can Help You Avoid an IRS Bill

The idea of owing the IRS more money than you can afford to pay is enough to strike fear into any heart. And that’s what would have happened to thousands of California homeowners had Congress not consistently extended the Mortgage Debt Relief Act – now in force through 2016.

However, homeowners who have been struggling financially have no real needed to worry.

While the term “insolvent” is not one that most of us would like to apply to ourselves, the IRS definition of this term may be the saving grace for California homeowners whose mortgage debt far exceeds the current value of their homes.

The following is excerpted from the IRS instructions found at www.irs.gov.

We’ve included official IRS definitions as referenced and found later in their text. Notes in parentheses are ours.
………………………
Insolvency

Do not include a canceled debt in income to the extent that you were insolvent immediately before the cancellation. (emphasis mine – note the date)You were insolvent immediately before the cancellation to the extent that the total of all of your liabilities was more than the FMV of all of your assets immediately before the cancellation. For purposes of determining insolvency, assets include the value of everything you own (including assets that serve as collateral for debt and exempt assets which are beyond the reach of your creditors under the law, such as your interest in a pension plan and the value of your retirement account).

Liabilities include:
• The entire amount of recourse debts,
• The amount of nonrecourse debt that is not in excess of the FMV of the property that is security for the debt, and
• The amount of nonrecourse debt in excess of the FMV of the property subject to the nonrecourse debt to the extent nonrecourse debt in excess of the FMV of the property subject to the debt is forgiven.

You can use their Insolvency Worksheet to help calculate the extent that you were insolvent immediately before the cancellation.

This exclusion does not apply to a cancellation of debt that occurs in a title 11 bankruptcy case. It also does not apply if the debt is qualified principal residence indebtedness unless you elect to apply the insolvency exclusion instead of the qualified principal residence indebtedness exclusion.

Qualified Principal Residence Indebtedness

You can exclude canceled debt from income if it is qualified principal residence indebtedness. Qualified principal residence indebtedness is any mortgage you took out to buy, build, or substantially improve your main home. It also must be secured by your main home. Qualified principal residence indebtedness also includes any debt secured by your main home that you used to refinance a mortgage you took out to buy, build, or substantially improve your main home, but only up to the amount of the old mortgage principal just before the refinancing.

How to report the insolvency exclusion. To show that you are excluding canceled debt from income under the insolvency exclusion, attach Form 982 to your federal income tax return and check the box on line 1b. On line 2, include the smaller of the amount of the debt canceled or the amount by which you were insolvent immediately before the cancellation. You can use the Insolvency Worksheet, to help calculate the extent that you were insolvent immediately before the cancellation. You must also reduce your tax attributes in Part II of Form 982 as explained under “Reduction of Tax Attributes.”

…………………………………………………

Remember that the insolvency exclusion applies to all forgiven debt. So if you got a reduction on a credit card account in exchange for full payment, or if a credit card company “wrote off” your debt, you’ll owe the income tax if you can’t prove insolvency.

If you think you may be eligible for tax relief under these IRS rules, please contact your tax professional for further advice.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Can I Short Sell a San Diego House in Probate?

Yes, you can short sell a San Diego house in probate. We’ve done this successfully for many clients, and it’s a good idea.

Short selling before the estate is settled can be a helpful tool, especially if the estate or the heirs are struggling to keep up with mortgage payments. If the house is to be sold, it’s better to get it done quickly rather than pour estate or family resources into a house that’s upside down.

And – getting it “over and done with” can prevent the estate from exposure to a collections lawsuit on HELOCs and other junior lien holders should the first mortgage foreclose.

A San Diego short sale during probate is simply a smart way for an estate to make sure that they’ve cleaned up any lingering liabilities.

In addition to protecting the estate from liability, short selling now while there is but one executor to sign the paperwork can be much easier than waiting until two or more heirs would need to come into agreement. As it turns out, a short sale is often more streamlined when the debtor is deceased.

No two San Diego short sale situations are exactly the same, so we’d be glad to meet with you and discuss the best course of action for your specific situation.

You can reach us by writing td@tomdunlalp.com or by calling 619-929-1413.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Bank Says “Too bad” about failed Loan Modifications

In an article in the Minneapolis Star Tribune, writer Chris Serres blasted the banks for luring people into believing they’ll get help, when help is far from what they’ll get.

Here are excerpts from that article: 



”A spokesman for J.P. Morgan Chase said the risks are disclosed to homeowners. Under the trial modification signed by homeowners, J.P. Morgan reserves the right to terminate the plan at any point and begin foreclosure. The bank also reserves the right to determine the final amounts of unpaid interest and any other delinquent amounts.”

“We work with customers to try to keep them in the home whenever possible,” said Thomas Kelly, a bank spokesman. “And the HAMP documents clearly explain the steps along the way.”

In other words, the banks are saying that homeowners “know the risks,” so if they’re deep in debt and lose their homes after a loan modification fails, its their own fault.

The lesson: Before you sign anything, read each document carefully. If the paperwork contains even one sentence that you don’t understand, have a qualified real estate attorney review the paperwork before you sign.

If you’re now attempting a loan modification and being put through a wringer, call us at 619-929-1413 or write td@tomdunlap.com. We can offer you insight as to your chances of success, and what to do next to avoid foreclosure.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Is a Deed-in-lieu safer or better than allowing a foreclosure?

Is a deed-in-lieu better than a foreclosure?

In a word, no. So what’s the difference?

In terms of your credit, there is no difference between a deed-in-lieu and a foreclosure. A deed-in-lieu merely saves the lender from spending the time and money to go through the foreclosure process.

The only difference to you is that you’ll probably know a definite date when you need to be out of the house – and you’ll probably need to be out sooner. With a foreclosure, your move-out date could be delayed for up to a year.

Meanwhile, under today’s guidelines, a foreclosure or deed in lieu will probably require 7+ years of good credit before buying a next home.

In addition, under California law, if you have a second mortgage that was not a “purchase money mortgage” the lender can come back on you for a deficiency after either a foreclosure or a deed-in-lieu. The only way to avoid that risk is through the short sale of your home.

The strange thing is, even though it’s more convenient, cheaper, and less time-consuming for the bank, you might not even be allowed to sign a deed in lieu. In order to be considered, you’ll have to fill out an application. And if you have two loans, you’ll probably be denied unless the same investor (not the same servicing company) owns both notes.

So… Is a deed-in-lieu better than a foreclosure?

Our answer is: “Don’t even consider it.” There simply is no benefit to the homeowner.

What about the January 2013 announcement from Fannie Mae?

In 2013 Fannie Mae announced that they’ll allow on-time borrowers to wipe out their mortgage debt through a new “mortgage release” program. This program is simply the re-naming of the deed-in-lieu process. And while it may be of benefit to homeowners in other states, it’s not a benefit to California homeowners. Here’s why.

Every situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to analyze situation and provide the answers you need before making a decision that will affect your future.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

How a Short Sale Will Affect Your Ability to Buy Another Home

Many San Diego homeowners have worked hard to preserve good credit. Some come to us with a pristine credit record, yet are saddled with debt – most of which they have incurred in order to keep current on mortgage payments. The conclusion that they need to offer their house as a short sale is a very heavy one to reach for any homeowner. And, for some, the idea of foreclosure seems painless and quick under the circumstances.

The real fact is that a lender will not like seeing either on your credit. AND, the very real fact is that you can recover your credit within 24 – 36 months after the short sale of your house while 60 months is the minimum after a foreclosure.

There are about as many opinions as people writing or speaking on this topic. The real answer is that no one really knows how a short sale will affect your credit scores.

I hear REALTORS® saying without a doubt… a short sale and a foreclosure are completely different. Then, I hear bankers and mortgage brokers saying that default is default… don’t do it. The truth is, both sides of the coin are right. What the mortgage or loan officer fails to realize is that anyone asking that question is very likely without a BETTER alternative.

Only the people at Fair Isaac, the FICO people, really know what each item does to the math on your credit score. And there are many factors that go into the mix. In addition, since each person has a different credit history, the short sale of a home will affect different people in different ways.

Let’s assume that it is you asking the question. You’re paying the bills on time, but paying off the mortgage is not an option for you. Let’s say you are either in default or headed into default OR that you have decided to keep paying the note on the asset that has lost a large chunk of value.

Let’s assume that you are thinking about the credit risk of foreclosure versus a short sale.

We know that a default is a default. And you will probably never get through a short sale UNTIL you are in default. If you are paying the bills, the lender assumes that you must have some means to do so, somewhere.

So, if you want to Buy a Home After a Short Sale…

A foreclosure will remain on your credit report in the public records section for 10 years. In addition, you will need to answer these questions on any loan application:

  • Have you ever had property foreclosed upon or given title or deed in lieu thereof?
  • Have you directly or indirectly been obligated on any loan which resulted in foreclosure, transfer of title in lieu of foreclosure, or judgment?

There is no such question for short sales.

Again, the real fact is that a lender will not like seeing either a short sale or foreclosure on your credit. But the second very real fact is that you can recover your credit with 24 – 36 months after the short sale of a home while 60 months is the minimum after a foreclosure.

If you’re ready to short sell your house, or simply have questions related to short sales, call 619-929-1413 or write td@tomdunlap.com.

We have a track record of 98% success in selling and closing the short sales we list – and we’ve helped hundreds of San Diego homeowners just like you avoid foreclosure and get on with life.

We’ll be happy to explain the process and answer all your questions.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Don’t use your Visa to make your San Diego home mortgage payment!

Holding on to your home is an honorable goal, but going deep into credit card debt to do so is a sure path to economic ruin.

Your credit cards will only go so far, and then what? You could lose the house to foreclosure and be left with a huge high-interest unsecured debt.

Don’t wait and let the situation get worse.

If you wait, the financial fallout can be even more dire…

If you are in financial trouble or think you may be headed that way, consider getting out from under that house debt through a short sale. Under California law, the banks that own your home loan or loans cannot come back to you for the deficiency if you sell. If you allow the house to go into foreclosure, your second lien holder can sue you and obtain a deficiency judgment.

Meanwhile, if you’ve run up credit card debt that you can’t or don’t want to pay, the credit card companies can also sue and obtain judgments.

The only way out of those judgments is to pay them or file for bankruptcy.

Once you’ve listed your home as a short sale with an experienced San Diego short sale agent, you can stop making those payments – giving yourself space to breathe and to accumulate some funds.

Experienced is the key word. Don’t list with an agent who lacks the experience and expertise to not only find a buyer but to negotiate with the banks to bring your short sale to a closing. This is the time to enlist the aid of short sale specialist.

The economy is still in an unsettled state, being buffeted by forces neither you nor we can control. So conserve your cash and make decisions that will aid in your long term financial health.

To learn more about San Diego short sales and how a short sale will affect you, call 619-929-1413 or write td@tomdunlap.com for personalized answers to your short sale questions.

We’ve helped hundreds of San Diego homeowners avoid foreclosure and have a track record of 98% success in selling and closing our short sale listings.

Every situation is different, so use this opportunity to get specific answers for your specific situation.

Call today. We’re here to help.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What hardship prevents you from making mortgage loan payments?

Before the bank will consider your San Diego short sale you’ll need to show that you’ve suffered a hardship. Thus, short sale hardship letters are a necessary component of a short sale request package.

Does your hardship qualify? Unless you clearly demonstrate a hardship, the bank will assume that you do have the ability to continue making payments, and your short sale request will be denied.

What constitutes a hardship?

A change in circumstance that affects your financial state. For instance:
• Death of a spouse/partner who contributed to the mortgage payments
• Illness that has prevented a person from working
• Layoff
• Divorce
• Change in loan payment due to an Adjustable Rate Mortgage (ARM)

Short sale hardship letters, which explain what has changed and why, are submitted along with financial information such as tax returns, pay stubs, bank statements, and a run-down of monthly expenses.

Have you suffered a qualifying hardship?

If you need help deciding whether your situation qualifies as a hardship for a short sale in San Diego, call 619-929-1413 or write td@tomdunlap.com.

Because we’ve helped hundreds of homeowners successfully sell their homes, we have become well acquainted with each bank’s preferences. We know what needs to be included in short sale hardship letters – and how to say it. We’d be pleased to share that information.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Want the bank to agree to a short sale of your home? You’ll probably need to stop making payments.

San Diego homeowners who have been trying to preserve their credit rating but need to short sell are often dismayed to learn that they’ll probably need to stop making their mortgage payments in order to be considered for a short sale.

This is because the bank wants to see that continuing to make payments is a hardship. If you continue to make payments, no matter how far you’re going into debt to do so, they can’t see the hardship.

Once you stop making payments, you’ll get the attention of the analysts, negotiators and investors at your lending institution(s).

However, this is not the end of the world. If your other payments are up to date and you manage your money carefully, your credit scores will begin to improve as soon as the short sale of your home is final. In as little as 2 years you could be eligible for another home mortgage.

The thing to remember is:Every short sale situation is different. If you’d like specific answers that relate to your situation,call 619-929-1413 or write td@tomdunlap.com to ask questions and get answers that relate to your specific situation.

You may even be able to get the short sale of your home approved with all payments current. This largely depends on your lender and how much weight they give to short sale hardship letters. Each asset manager and each homeowner’s situation is different.

If you need help figuring out if you should stop paying your mortgage so you can do a short sale in San Diego, please don’t hesitate to contact us. We’ve studied each bank’s guidelines, know what carries weight for them in short sale hardship letters, and have developed a working relationship with most bank negotiators – so we can guide you in making that decision.

If you’d like to talk it over, call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

The Value of Persistence in a San Diego Short Sale

Robert Ringer, former real estate agent and best-selling author of “To Be Or Not To Be Intimidated,” and “Looking Out for #1,” writes a lot about success. One of his consistent themes is the necessity for persistence.

In one book he tells the story of dealing with call centers. In one instance he wanted to change his account information with a phone company. The representative told him he’d need to print a form, sign it in front of a notary, and mail it in.

But he didn’t want to go through all that, so he hung up and re-dialed. The next representative changed the information in the company computer system and he was done.

Another time he wanted to buy a product in bulk for a certain price. The representative said no, that couldn’t be done. So, once again he hung up and re-dialed.

The next person he talked to agreed to sell him the product in bulk for the price he wanted. He got what he wanted a lot faster and easier than if he had spent time arguing with the first person.

So what does succeeding with call centers have to do with closing San Diego short sales? Both require persistence.

Negotiating the successful short sale of any home begins with having the expertise to properly prepare both the paperwork and the argument in favor of the short sale. It requires having the facts to back the argument, and the persistence to make sure those facts are heard and understood. If the first person we talk with isn’t willing to listen or cooperate, we ask someone else.

Success also requires unrelenting follow-up, so that our clients’ files don’t get shoved aside or forgotten. This persistence increases our odds of success – and it’s a procedure that inexperienced agents don’t even realize they need to use.

When we list your San Diego area house as a short sale, our goal is to help you wipe out the upside down debt and remove the threat of foreclosure. We also want to keep you in a position to get a new mortgage loan in two years rather than the 7 to 8 years you’ll have to wait if your home goes to foreclosure.

Success in those goals requires the kind of persistence that refuses to take no for an answer. And that’s just the kind of persistence that we’ll use on your behalf.

If you are considering the short sale of a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego, call the team that doesn’t give up.

To get your questions answered quickly, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to explain the real estate short sale process and answer any questions you might have about the possible short sale of your San Diego area home.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

For Bank’s Short Sale Negotiators, Common Sense is not a requirement

San Diego real estate agents – and agents across the nation – have a hard time understanding the actions of bank’s short sale negotiators. Often, their decisions and demands are completely lacking in common sense.

A conversation that was related to me by another San Diego real estate agent illustrates the kind of thinking that makes us wonder about their real objectives. Here’s how it went:

Bank’s short sale negotiator:
“I can’t process this short sale without the TPG form filled out with the seller’s full name.”

Agent: “Based on my calculations, this short sale will help your company avoid a $17,000 loss, but you’re telling me that unless I can get you a corrected TPG form, you’ll reject the short sale of this home and subject your company to a potential $17,000 loss.”

Negotiator: “That’s right.”

Agent: “But $17,000 is a lot of money. Don’t you agree?”

Negotiator:
“I don’t care about the money. The TPG form is company procedure.”

You’d think there was a serious mistake, wouldn’t you? But no, that wasn’t the case. And the negotiator was the only one with a problem. The Title company and the buyer’s lender were completely OK with the paperwork as it was.

The problem was a discrepancy in the seller’s name. His full legal name was something like “John W. Doe II.” But one form had “John Doe” entered for the seller’s name. The short sale negotiator was going to reject the short sale of this home unless his name on that form was changed to “John W. Doe II.”

She was willing to subject her investor and/or the banks’ shareholders to a minimum $17,000 loss because she wanted a different piece of paper.

You know that no business person dealing with their own money would take that attitude. But the short sale negotiator wasn’t dealing with her own money. So all she cared about were the procedures and the forms. Common sense didn’t enter the picture at all.

The result of this kind of nonsense is that many banks turn down short sales only to lose more money through a foreclosure.

Had this agent been unable to secure the required form, the house would have gone into foreclosure within 6 months. By then, due to the rate at which market values were falling at the time, it would have lost $13,500 in value by the time of the foreclosure. By the time it went through the foreclosure listing process, it would have lost another $7,000 to $14,000.

But the bank’s negotiator was willing to take that loss unless the form was filled out correctly and re-submitted.

If you were a stockholder in that bank, would you have approved?

This scenario leads us to 2 conclusions:

  • First, the banks need to train their negotiators in the art of using common sense and looking at the bottom line.
  • Second, agents who represent sellers in short sales need to learn how to “head these problems off at the pass.”

Short sale request packages need to be submitted in the manner that pleases the bank. And each bank has a different way of being pleased. Short sale agents need to do their homework.

In addition, agents need to check and double-check the forms before submission. A name discrepancy is minor, but in this case, it nearly put the seller in foreclosure.

Our careful attention to detail and knowledge of what each bank wants is one of the reasons that in nine years of dealing with short sales, we’ve been successful 98% of the time.

So if you need to short sell your house in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego, call 619-929-1413 or write td@tomdunlap.com.

We’ll be happy to meet with you to explain the real estate short sale process and answer any questions you might have.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

If I don’t have to pay income tax on my forgiven mortgage debt, why did I get a 1099 form?

If I don’t have to pay income tax on my forgiven San Diego home mortgage debt, why did I get a “Debt forgiveness” 1099 form?

We are not tax professionals and cannot give tax advice, but we can tell you the short answer: Because the IRS requires it.

Most San Diego homeowners know that under the terms of the Mortgage Forgiveness Debt Relief Act of 2007, homeowners are not required to pay income tax on forgiven debt if that debt was incurred for the purchase or improvement of a qualified principal residence. This Act  was extended through December 31, 2016, and hopefully it will be extended again.

So it’s natural for those who have gone through foreclosure or had debt forgiven through a short sale to wonder why they received a debt forgiveness 1099 form, and why, on page 11 of IRS publication 4681, it states: “The lender must file form 1099-C and send you a copy if the amount of debt canceled is $600 or more and the lender is a financial institution, credit union, federal government agency, or any organization that has a significant trade or business of lending money.”

The publication doesn’t actually state why, but we can assume the reason to be verification of “bad debt” deductions on the part of the lender. Remember that your lender is allowed to reduce its taxable income by the amount of debt forgiven.

Publication 4681 gives examples and shows how to report the debt forgiveness 1099 on your taxes, then how to use form 982 to show that you aren’t liable for tax on the forgiven amount.

Do note that The Mortgage Forgiveness Debt Relief Act of 2007 only removes tax liability from indebtedness directly related to the purchase or improvement of your home. You will still be liable for debt on a second mortgage or home equity line of credit used to pay off other debt, purchase a car, take a trip, etc.

However, you may still be exempt from income tax on forgiveness of that debt. If you have forgiven debt related to a second mortgage or a home equity line of credit, and if you were “insolvent” at the time the debt was forgiven, you won’t be required to include it in your income. Pages 4 and 5 of publication 4681 explain how to determine insolvency and page 6 offers a worksheet.

Do consult with a tax adviser before assuming that you owe or don’t owe.

If you have questions about how the laws affect you, call 619-929-1413 or write td@tomdunlap.com. We’ll be glad to assess your situation and put you in touch with tax advisers who can help protect your financial future.

This information is not to be taken as tax advice. We are not tax professionals are we are not familiar with the intricacies of tax law.

Please read IRS Publication 4681 and consult your CPA or tax preparation professional for advice.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

In San Diego Short Sales, Knowledge is Power

Sometimes you have to wonder if the bank negotiators even know their own investor’s guidelines. And if they do know the guidelines, why they put roadblocks in front of San Diego residents trying to short sale their homes.

Each investor does have their own guidelines for short sales, which is why a short sale agent’s first step in preparing a short sale package is learning who owns the loan. The next step is knowing that investor’s guidelines.

If the agent doesn’t have that information, an uncooperative short sale negotiator can “run a bluff” or tell an outright lie, and the San Diego short sale agent won’t know the difference.

When it comes to short sales, our knowledge is your power. Call 619-929-1413 or write td@tomdunlap.com to tell us your situation and get the answers you seek.

A short sale saved by knowledge…

Not long ago we closed a Kensington short sale owned by Fannie Mae. The bank’s appraiser said this San Diego area home was worth $620,000.

Because we’ve closed short sales on Fannie Mae owned homes in San Diego many times, we knew their guidelines and what they would accept as a percentage of that value.

But, when we presented an offer for $6,000 more than the price we knew was acceptable under those guidelines, the short sale negotiator countered the offer. She said the investor would not go that low and buyers must pay more. They had seen other homes they liked and in fact had a “fall back” home in mind if the bank refused this offer. They weren’t going to pay more.

Because we knew this was an acceptable offer, we were able to persuade the negotiator to accept the offer as it was presented. Had we not known the Fannie Mae guidelines, this sale would have fallen through and the home would have become yet another San Diego foreclosure.

Knowledge is one of the reasons why after 9 years of negotiating San Diego area short sales, we have a 98% success record in keeping homeowners out of foreclosure.

Every short sale situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to answer your questions and to explain the short sale process.

If you’re underwater on a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and need to sell, we can help.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Help! I don’t have the money for my San Diego property taxes!

Recently, a Rancho Bernardo homeowner shared his concern about not having the extra money to pay the San Diego County property tax bill that was soon due. He was worried that San Diego County might seize his house for non-payment of property taxes.

He was glad that he took advantage of the opportunity to ask, because we were able to put his mind at rest.

Why you don’t need to panic over the San Diego County property tax bill…

As you probably know, San Diego County property taxes are paid in two installments and are due December 1 and April 1 each year. They become past due 10 days after the due date. At that time, the homeowner is assessed a 10% penalty and a $10 fee.

If the taxes have not been paid by June 30, when the fiscal year ends, the homeowner is charged a $15 redemption fee and the unpaid tax amount will begin to accrue interest.

That’s the bad news. The good news is seizing and selling homes just adds to their workload. They’d much rather give you help in the form of a payment plan. And even if you don’t make payments, your San Diego home won’t be subject to seizure by the county until taxes are 5 years past due.

So even though you don’t want to pay their high interest rate, if you don’t have the funds and don’t know if you’ll keep the house, just wait.

If you’re trying to keep your home and working on a San Diego loan modification, wait to see if it will become final. Once the loan modification is final (NOT in a trial period), then pay the back taxes as soon as you can in order to avoid the interest charges and late fees.

If you’re offering the house as a San Diego short sale, or if you’re letting it go to foreclosure or signing a deed-in-lieu, don’t worry about the property taxes at all. Save your money for moving expenses once the house is sold. The bank will be required to make this payment.

If you’re behind on San Diego home mortgage payments and you’re undecided about what to do… Call us.

We have the same software the bank uses to determine whether your loan modification request will even be considered. This can save you from months of waiting and wondering.

If you’re considering short selling, we’ll be glad to explain the process and answer any questions you might have.

We do strongly recommend that you choose a San Diego short sale over signing a deed-in-lieu of foreclosure or doing nothing and waiting for a foreclosure. Either of those actions will put you at risk of a deficiency judgment if you have a second mortgage or a home equity line of credit. A short sale will prevent that risk.

In addition, a short sale is far less damaging financially, and will put you in a position to own a home again in two years, as opposed to 5 to 8 years with a foreclosure.

No two short sale situations are exactly alike. When you want advice that applies to your specific situation, call 619-929-1413 or write td@tomdunlap.com to request a no-obligation consultation.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

In a San Diego short sale, do I have to know who owns my mortgage loan?

Yes, when making application to short sell your San Diego house, you really do need to know who owns your loan.

Generally, it isn’t the company you pay. Most loans today are sold almost immediately after being granted. In fact, they may be sold 2 or 3 times within the first few weeks or months. Many are sold to Fannie Mae, Freddie Mac, or a Wall Street Firm.

The company you send payments to is simply a subcontractor, hired to collect payments, handle escrows and accounting, and manage their debt collections and foreclosures. These banks are “asset managers” and now, short sale negotiators, for the investors who actually own the loans.

The “Final Rule” amending Regulation Z (Truth in Lending) went into effect on January 1, 2011, and mandated that ownership must be disclosed. All investors acquiring mortgage loans are now required to provide the consumer with the name, address, and telephone number of the new owner, and the transfer date. They’re also required to provide the homeowner with the name, address, and telephone number of the party who is authorized to receive the mortgage loan payments.

However, most homeowners still don’t know who owns their loans – especially if ownership was transferred prior to January 1, 2011. But don’t worry. This is a detail that experienced San Diego Short Sale agents will ferret out for you.

But if I’m asking for approval to short sale my home, why does it matter who owns my loan?

Because knowing which bank or entity actually owns the loan is vital to short sale negotiations.

Each investor has its own guidelines regarding the selling price they’ll accept for a short sale relative to their own appraisals. Experienced short sale negotiators take the time to learn those guidelines so they can negotiate more effectively with the bank’s asset managers.

Successful San Diego short sale agents:

  1. Develop a working relationship with asset managers / short sale negotiators at each of the banks that handle mortgage loan portfolios for investors
  2. Know each investor’s guidelines
  3. Negotiate from a position of knowledge

We’ve kept hundreds of San Diego area homeowners out of foreclosure since this crisis began. We’d like to do the same for you, so if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are thinking about a short sale, get in touch.

You have short sale questions; we have answers.


Call 619-929-1413 or write td@tomdunlap.com We’ll be glad to talk with you with no obligation.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Forensic Loan Audits – Do You Need One?

When you see or hear the term “forensic” it is usually in connection with a story or show about criminal activity. They use “forensics” to gain evidence and convict the criminal or to determine how a crime was committed.

One of the definitions of the word is: “Relating to or dealing with the application of scientific knowledge to legal problems.”

We think the word “detailed” might be more appropriate than “scientific” in a Forensic Loan Audit, but the purpose is nearly the same: to gain evidence in order to determine if a crime has taken place.

What is a Forensic Loan Audit?

It is a comprehensive and detailed audit/examination of every document related your mortgage contract – from the good faith estimate all the way through the closing documents and beyond. The audit’s purpose is to determine whether a lender has violated any federal, state, or local laws with regard to a mortgage loan. As he or she reviews the documents, the auditor will be searching for violations.

A forensic loan audit will reveal if there have been violations of the Real Estate Settlement procedures Act (RESPA), the Truth in Lending Act, the Home Owner Equity Protection Act, and others. The auditor will also look for signs of predatory lending, forgery, violations of good faith estimate compliance, and other misrepresentations of any kind.

Following the Forensic Loan Audit the auditor will present his or findings in writing, with an analysis and recommendations for loan modification terms and short sale negotiations.

In cases where fraudulent activity has been discovered, audits have helped homeowners tremendously. Some homeowners have even had their loans forgiven entirely. But these are not the norm.

The reason these cases make the evening news is that they are unusual. Most audits find no evidence of fraud – so don’t spend money on a forensic loan audit in hopes something will pop up. Only order a forensic loan audit if you honestly feel that there is something not quite on the up-and-up about your San Diego home mortgage.

Finding discrepancies may or may not help your cause in negotiating a loan modification or a San Diego short sale. While some bank negotiators might be swayed by the results of an audit, others will simply be annoyed. Often you are more likely to gain their cooperation by allowing us to negotiate without mention of it.

Of course, if your audit turns up solid grounds for legal action against the lender, that’s a different matter. You may not need to worry about the bank’s negotiator. Just be aware that few audits do find errors of that severity.

We’ve been successfully handling San Diego area short sales for 6 years now – and our success record at keeping homeowners out of foreclosure stands at 98%. So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and need to sell short, get in touch.

You can reach us by calling 619-929-1413 or writing td@tomdunlap.com.

A word of caution: If you decide to have an audit, do your homework before choosing an auditing firm. Use Google, get references, and proceed with caution. The current economy has spawned a variety of crooks waiting to prey on homeowners who are in distress. Some of those predators call themselves Forensic Loan Auditors.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

San Diego Short Sale Success is Often Determined by the Initial Application

Almost any conversation about real estate these days includes a story or two about a San Diego short sale that drug out for 6, 8, or 12 months before closing. Some stories are even worse – they tell of short sales that were rejected after the bank sat on the paperwork for up to 6 months.

The stories are true, but it isn’t likely to happen that way if the listing agent has both expertise and experience with San Diego short sales.

Sometimes the bank’s asset managers are simply slow or inefficient, but more often the delays and problems can be traced back to the San Diego homeowner and his or her listing agent.

It’s all a matter of procedure – and submitting the request properly the first time.

If you want to gain the asset manager’s cooperation, you submit everything they want in a package with the initial short sale request. That makes the asset manager’s job easier – and when you make anyone’s job easier, you set yourself up for a good working relationship.

If you fail to submit the required paperwork, your request will go to the bottom of the stack, and it could be weeks or even months before you get notification about the missing items. Naturally, the negotiation won’t start until the bank has everything it wants.

Over the past several years,we’ve had a 98% success rate in selling and closing the San Diego short sales we list. One reason for that success is that we’ve taken the time to learn what each of the major banks wants in the initial short sale request package. We make sure it’s all there, with the pages arranged in the specified order. In other words, we set the stage for success with the initial contact.

If you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are considering a short sale, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to explain the process and answer your questions – at no obligation, of course.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Can I buy back the house I’m short selling?

Many San Diego homeowners would like to remain in their homes – but with a considerably lower mortgage payment and a smaller loan balance.

Thus the question arises: Can a seller buy back the house he is short selling? The answer is “Probably not.” In fact, most lenders will not allow you to sell to a relative, a close friend, or a business associate.

Most San Diego short sale contracts require both the buyer and the seller to certify that theirs is an “arms length” transaction.

What is an “arms length” transaction?

According to the Dictionary of Banking terms, an “arms length” transaction is: “A transaction carried out by unrelated or unaffiliated parties, as by a willing buyer and a willing seller, each acting in his own self-interest. Pricing based on such transactions is the basis of fair market valuations.”

If you were to purchase the house yourself or to sell it to someone close to you, the bank might assume that they weren’t getting the highest possible price for the house. And of course, the highest possible price is their goal.

However, while we have not witnessed it, we have been told that some banks will approve a non-arms length transaction if it appears to be in the bank’s best interests. Thus, it can’t hurt to ask. Just don’t be surprised when the answer is “no.”

Depending upon your bank and its policies, you may be able to refinance with a principal reduction or to work out a loan modification.

If a loan modification is your choice, do come and see us before making application.

We have the same software that the banks use to determine whether or not you’re qualified – and we can tell you within minutes what it might take weeks or months to learn from the bank. If it does appear that you qualify, we can also give you information on how to present your case in a manner that gives you the best chance of success.

If neither a refinance nor loan modification will work, list your home as a short sale, get it sold, and move on with your life. The sooner you make the decision the sooner you’ll be out from under the burden of high payments. Then, in just 2 or 3 short years, you’ll be eligible to purchase another San Diego home.

If you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego, and want to put it on the market as a San Diego short sale, we can help. We’ll be glad to answer your questions and explain how a short sale is transacted.

We are short sale specialists. We’ve been successfully handling San Diego area short sales for the past 9 years, with a 98% success rate. We’d be pleased to help you too, so feel free to call with any questions.

To reach us, just call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Who decides which short sale offer to accept? The Homeowner.

The Homeowner decides which offer to accept.

Because the seller’s lender has to approve a short sale, many believe that it is the lender who sees all the offers and decides which to accept. That’s not true. It’s just one of the misconceptions that’s been repeated so often that people have come to believe it.

As long as no foreclosure has been finalized, the homeowner still has the right to accept or reject any offer to purchase his or her home. The lender’s asset manager simply approves or rejects that offer after your agent submits it.

It is the San Diego homeowner who chooses the listing agent and sets the listing price, based on advice from his or her short sale listing agent. When the listing agent is experienced in San Diego short sales, that listing price will fall within a range that’s acceptable to the lender.

It is also the homeowner who chooses which offer to submit to their lender for approval.

A San Diego homeowner may reject any offer – for any reason.

San Diego homeowners aren’t obligated to entertain offers far below market value, and can in fact reject an offer simply because the buyer “rubbed them the wrong way.” It is still their house.

Unfortunately, some San Diego home buyers and their agents don’t understand this. Some believe that the homeowner must accept any offer and submit it to the lender.

Most of the time, homeowners have good reasons for rejecting an offer. Those reasons include:

  • Price: Your agent has advised you that the bank won’t approve an offer below a certain number, and this offer is lower.
  • The buyers want expensive repairs – and you don’t plan to spend any more money on the house.
  • The buyers have included excessive contingencies – a sure sign that they’ve probably submitted multiple offers and could decide to walk.
  • The buyers have not gotten a loan pre-approval – so you don’t know that they could actually close.
  • The buyer has not put down enough earnest money to make you feel that he or she is serious and they refuse to increase it.

If you are underwater with a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are thinking of short selling, get in touch.

You can reach us by calling 619-929-1413 or writing td@tomdunlap.com.

As San Diego Short Sale specialists, we have helped hundreds of homeowners avoid foreclosure over the past 9 years. In fact, we have maintained a 98% success rate in getting our short sales closed.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Beware of Loan Modification Scams

As most San Diego homeowners know, loan modifications did not turn out to be solution that was promised.

A program that was supposed to give aid to more than 3 million troubled homeowners across the U.S. within the first year has instead, after several years, helped only about 600,000 homeowners nationwide.

So, while we know that most loan modifications fail – or end in foreclosure for San Diego homeowners – the slight chance of success gives hope to some who desperately want to keep their homes.

As a result, troubled homeowners have become the latest “easy target” for con artists. These con artists run crooked companies that promise that for an up-front fee, they’ll handle all the paperwork, details, and follow-up – and the homeowner will get a loan modification.

The truth is, many of these companies don’t even attempt to help the homeowners. They simply take the fees, which can range from $750 up to nearly $4,000. Even worse, they advise the homeowners to stop making payments – a move that almost guarantees foreclosure.

Some of these companies have been shut down and fined. Others are still in operation and still fleecing homeowners when they can least afford it.

If you are considering a loan modification on your San Diego home, please realize that you will be your own most effective negotiator. However, there are things you need to know before you start the process. The first is whether your payments, income and assets fall within your bank’s guidelines for loan modification.

If they don’t, the bank will take your application and let you wait for several months before they send you a rejection notice. By then you will have wasted precious months when you might have been considering other alternatives – such as offering your home as a San Diego short sale in order to avoid the stain of foreclosure.

Talk to us first…

Before you apply for a loan modification, call Tom Dunlap and make an appointment to come in and talk. We have obtained the software and the guidelines that will enable us to tell you within minutes whether your San Diego loan modification application will even be considered.

If the answer is yes, we can explain some things that the banks won’t tell you. For instance:
• How to write an effective hardship letter
• The 3 most common loan modification mistakes – and how to avoid them
• What not to do so you don’t risk being carted off to jail
• How to calculate and present your budget properly to increase your chance of success

If the answer is no, We’ll be happy to explain how you can still avoid foreclosure through the short sale of your San Diego home.

And yes, when considering foreclosure versus short sale, a short sale is the far better choice.

Over the past 9 years, Tom has successfully helped hundreds of San Diego area homeowners avoid foreclosure through short sales. In fact, he has a 98% success rate. He can do the same for you – as long as you don’t wait too long to ask for assistance.

So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are contemplating either a loan modification or a short sale,call 619-929-1413 or write td@tomdunlap.com to tell us your situation. We’ll be happy to help you determine whether you’ll be eligible for a loan modification, explain the real estate short sale process, and answer your questions about both the benefits and consequences of a short sale.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Why Won’t My Agent Show Me Short Sale Listings?

More and more San Diego buyers’ agents are steering their buyers away from short sales. One lady who called on us to show her our short sale listings asked why her former agent refused.

With short sales making up a good portion of the inventory, she felt that she was narrowing her choices and probably missing out on some bargains. And of course, she was.

Buyer agents who know short sales are always willing to show our short sale listings.
The first reason many buyer agents steer clients away from short sales is that the client has indicated a need to purchase and close in a short time frame. In that case, the buyer should avoid short sale listings. No matter how skilled the listing agent happens to be, a short sale takes longer than a traditional sale, simply because it requires approval from so many people.

Depending upon the bank’s procedures, an experienced short sale agent can usually gain approval within 30-90 days. With an inexperienced listing agent it could take 6 months or more.

Getting approval from a homeowner can take only a day or two.

Next, the San Diego buyer’s agent in question may have had a bad experience.

She may have submitted a short sale offer on a home listed by an agent who didn’t submit the short sale request properly, or who didn’t follow up. Or, perhaps the listing agent was a poor negotiator. Or, perhaps the buyers’ agent didn’t understand his or her duties in the short sale process.

The number of problems that inexperience can cause are what lead us to say “Always use an experienced short sale agent.”

However, all of us had a first short sale, so we don’t want to bash anyone for jumping into something new. An inexperienced agent can do well if they have an experienced agent as a mentor to give assistance and advice as they go through the process the first few times.

Although no one can predict what the banks will do in each new transaction, we who specialize in San Diego short sales are careful to study each bank’s policies and procedures so that we can price our listings correctly and present an acceptable package the first time. Knowing what each lender wants and expects also enables us to negotiate from a strong position.

If your agent refuses to show you San Diego short sales, ask why. If you have time restraints, then your agent is correct. You should avoid them. But if the reason is your agent’s prior bad experience with short sales, ask him or her to only show you San Diego short sales listed by agents who specialize in short sales and have an outstanding track record for closing.

If you’re a buyer looking for an agent to guide you expertly through a short sale purchase, call 619-929-1413 or write td@tomdunlap.com to tell us your wants and needs. We’ll be pleased to do a search on your behalf.

We specialize in San Diego short sales – and we’ve successfully sold and closed 98% of our listings over the past 9 years.

We’ll be happy to show you our current short sale listings. And if you’re already working with a buyer’s agent, we’ll be pleased to cooperate with that agent to help you own the home of your dreams. Ask your agent to get in touch with us.

If you have questions about the short sale process and how it differs from purchasing a non-distressed San Diego home, please do call us at 619-929-1413 or write td@tomdunlap.com. We’ll be happy to answer your questions.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Can I Ever Own Another Home After a San Diego Short Sale?

Yes, you can own another home after a San Diego short sale. The short sale of your home does not mean becoming a tenant for life.

In fact, with careful money management, you can own another home just 2 or 3 short years after a San Diego short sale.

So that you’ll be ready, use this time to rebuild your credit scores and put some money away for a down payment.

Step #1: Pay down your other bills.

If you have other debts, and especially debts in arrears, start working to get them repaid. A “paid late” notation on your credit report looks better than a write-off or a judgment.

Check to see that you were cleared of all liability for your San Diego home loan when your short sale was finalized. If there’s a “deficiency judgment” against you, contact your lender and attempt to negotiate a pay-off for an amount less than you owe. Quite often, they will.

If Tom Dunlap helped you short sale your house, or if you sold after the new California laws regarding deficiencies went into effect, this should not be an issue.

Step #2: Check your own credit, even if you think you know what the report says

Order a free copy of your credit report from each of the major credit reporting bureaus. The bureaus are: Equifax, Experian, and TransUnion. Pay the extra few dollars to see your credit scores. Do get a report from all 3 bureaus, because they will probably not be exactly alike. Because it does cost money for businesses to report, some report to one bureau and not to the others.

Read the reports carefully to see that everything on them is true. Even the executives at FICO admit that over 70% of all credit reports contain errors. And while some are minor and can be ignored – such as a slight misspelling of your name – some of those errors can be damaging. All it takes is a keystroke error to put someone else’s debt on your credit report.

Watch for signs of identity theft, such as notice that you’re working for a new company, have a different spouse, or live at an address that isn’t yours. If you find such signs, contact the credit bureau and follow their advice.

If you find negative information that’s more than 7 years old, take steps to have it removed. The credit bureaus have forms for this purpose.

Step #3: Work on reestablishing your credit.

Become fanatic about paying every bill on or before the due date. As long as no new negatives are reported, time alone will repair your credit. You want to see those “Paid as agreed” notations on your credit report.

Keep your old credit cards and use them – but sparingly. The longer you’ve had credit with a given card company, the more positive influence it has on your credit scores, so don’t cancel any old cards and don’t stop using them entirely. Charge something every few months, then pay the bill when it arrives.

If you’re carrying credit card balances, work to bring them each down to 30% or less of the credit lines available to you.

Credit issuers like to see that you can handle more than one type of credit. So unless you already have them, apply for a small car loan or other fixed-payment installment loan. If you no longer have a credit card, go on line to research, find one that fits, and make application.

If your credit really suffered before your short sale, you’ll begin getting “bad credit” credit card offers in the mail. Before you choose one be sure to compare offers. There are HUGE differences. Some have initial fees almost equal to the credit lines they offer – and some have interest rates as high as 75%!

Apply for only one card. If you apply for several within a short period, it will signal that you’re desperate for funds and your scores will drop.

Once you have a new credit card, never use more than 30-40% of your credit line and always pay it down below 30% before the next billing cycle.

Step #4: Avoid Scams

Credit repair ads promising to rid your credit report of all negative information are scams. The only thing they’re going to remove is money – from you. In addition they could get you into legal difficulties, because some of the credit repair methods they promote are fraudulent.

What they can, but probably won’t, do is remove outdated or untrue information. And you can do that yourself by contacting the credit bureaus directly.

Legitimate debts, judgments, etc. cannot be removed by any legal means. They will, however, come off over time. You simply need to be patient and work on adding positive information to your credit report while the negative information fades into the past.

You can own another San Diego home. It will just take a little time and some careful money management.

If you aren’t sure whether you’re now qualified to purchase a new San Diego home, get in touch. We’ll be happy to discuss your situation and give you the benefit of our experience.

If you’re still just thinking of offering your home as a short sale, and wondering if you should or you shouldn’t, call 619-929-1413 or write td@tomdunlap.com to get advice and straight answers from Tom Dunlap – San Diego’s top short sale specialist.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Divorce – what to do with the house?

One of the questions that must be answered in divorce is “What do we do with the house?”

If you’ve needed your combined income to maintain the payments on your San Diego home, neither of you can handle it alone, so you’re forced to make a decision.

One choice is to keep the house and rent it out to cover the payments. Another is for one of you to remain in the house and rent a portion of it to assist with payments. However, renting does come with its own problems. One is compromising the tax status. The other is dealing with tenant issues such as collecting rents and performing “fix-up” duties after a tenant moves out. Your neighborhood zoning may also be a factor.

The other choices are selling or letting the house go into foreclosure.

Selling your San Diego home is always the best option.

If you have equity in the home, this is obviously the easiest and best solution. But even if your San Diego home is “underwater,” selling as a short sale is not only possible but will be more beneficial to both of you.

*Should you short sale or shouldn’t you? Call 619-929-1413 or write td@tomdunlap.com to get advice from San Diego’s top short sale specialist, Tom Dunlap.

When You Let Your San Diego Home Go Into Foreclosure…

At first glance, this might sound like a good option. One of you can remain in the home without making payments until a foreclosure is final. With many lenders taking a year or even longer to complete a foreclosure, that would give you breathing space and time to put away some funds before needing to find a rental. At the very least, you’ll have about 6 months from the time you make the last payment.

But this option does have drawbacks. First, it will severely damage your credit scores and thus your ability to rent or buy a home in the future – and even your ability to get a job. And unless only one of you signed the mortgage documents, this damage will apply to both of you.

It doesn’t matter if the divorce decree gave the house to one spouse. What matters is whose signature is on the mortgage loan application(s).

Next, if you have a home equity line of credit, the second lien holder can sue you and obtain a deficiency judgment. And, just as everyone’s credit scores will suffer, this judgment will obligate anyone whose name is on the application.

Finally, if you allow your house to go into foreclosure, you’ll both be ineligible for a new mortgage loan for from 5 to 7 years.

Good reasons to choose a San Diego short sale instead

Your credit scores will take a smaller hit and notice of the short sale will “fall off” your credit report in seven years rather than ten.

The time before you can get a new loan will also be shorter. After the short sale of a home, if you meet the other qualifications, you can get a new mortgage in as little as 2 years.

Short sale consequences are far less severe than the consequences of a foreclosure…

So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, or Metro San Diego and are facing divorce and loss of income, think seriously about a short sale.

Call 619-929-1413 or write td@tomdunlap.com to ask your questions and tell us the situation. We’ll give you straight answers.

First, we’ll be happy to help you determine whether you do have equity in today’s market. Then, if you need to short sale your house, we’ll explain the real estate short sale procedure and answer all your questions.

We specialize in San Diego short sales and over the past 9 years have maintained a 98% success rate in getting short sales closed. So get in touch. We’d like to help you avoid foreclosure, too.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Are the Banks Negligent, Indifferent, or Inefficient?

Whatever they are, their actions all too often spell financial loss for San Diego homeowners.

Here are 3 ways that loan servicers and asset managers are keeping some San Diego homeowners in distress.

1. Asset managers routinely delay their response to short sale requests.

Most San Diego home buyers want a “yes or no” answer within a few days of making an offer to purchase, but when they attempt to purchase a home in short sale status, they’re forced to wait. In fact, agents report waiting 6 months or even more just to get a yes or no.

The result: Many homeowners go into foreclosure while a ready, willing and able buyer stands ready to purchase.

The second result: Buyers withdraw their offers when their patience runs out. They made the offer because they wanted a home – so they move on and choose one that’s readily available. We can hardly blame them for that.

Those who are willing to wait for an extended period of time expect a bargain in return for their patience, and we can’t fault them for that, either.

This delay in responding to short sale requests causes many San Diego buyers’ agents to avoid showing short sales. It’s much easier to get an answer after a home becomes a bank-owned foreclosure.

Why do loan servicers delay response? Is it inefficiency, negligence, or indifference?

If banks wanted to protect their investors and help the real estate market rebound, they would make the short sale approval process as fast as possible. And they could. They could, but so far all they do is talk about it.

They could begin the property valuation process just as soon as they get the short sale request. They could also inject some common sense. After handling dozens of foreclosures and short sales in a given area, they should know market values. If homeowners knew the bank’s “bottom line” they wouldn’t waste time considering offers that were sure to be rejected.

* Should you short sale or shouldn’t you? Call 619-929-1413 or write td@tomdunlap.com to get advice from Tom Dunlap – San Diego’s top short sale specialist.

2. Banks routinely reject loan modifications that would prevent foreclosures and preserve neighborhood values.

While a few homeowners have been granted loan modifications, more have been refused. You’ll find no shortage of stories about homeowners who spent months submitting paperwork before being denied. Others have been granted trial modifications and faithfully made payments, then been denied.

And the guidelines are both unclear and conflicting. One representative tells the homeowner they must be in arrears to be considered – another tells them they must not be in arrears.

Many who “do not qualify” are wondering why. One woman I spoke with said “We’ve been managing not to get behind with our payments at $1,700 per month. But the bank says they’re denying our modification because we can’t afford $1,100 per month. Does this make sense?”

The result: Homes in foreclosure that could have been saved and neighborhood values dropping because of the presence of vacant homes.

Is it deliberate negligence, indifference, or inefficiency?

4. Banks that repossess San Diego homes simply don’t get them on the market in a timely fashion, and don’t maintain those homes while they stand vacant. And as we all know, vacant homes or poorly maintained homes bring down neighborhood values even as they erode the value of the house in question.

Is this because they simply have too many homes to deal with? Is it an intentional delay because they don’t want to flood the market with repossessed homes? Or is it because they have failed to develop efficient ways to streamline their processes?

Whatever the reason, entire neighborhoods have been damaged by the banks’ failure to act in a timely manner.

The good news for San Diego homeowners and short sale buyers is that we have developed systems and relationships with loan servicers that get our short sale requests pushed to the “front of the line.”

We can generally get an answer within 60 days or less, and because we know how to present our short sale requests and negotiate with the banks, that answer is usually “yes.” In fact, we have a track record of 98% success in closing our short sales.

No two short sale situations are exactly alike. When you want advice that applies to your specific situation, call 619-929-1413 or write td@tomdunlap.com to request a no-obligation consultation.

And if you already know you want to short sell your home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, or if you’d like to purchase a short sale, get in touch.

We’ll be glad to explain the short sale process, tell you what you can expect as a buyer or as a seller, and show you why we get good results while so many who attempt short sales fail.

We look forward to talking with you… so get in touch and we’ll set a time to get together.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Why Over 40% of California Short Sales Fail to Close

Don’t take chances with YOUR short sale.
According to a March 8, 2011 news release from the CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.), fewer than 60% of short sales begun in California during 2010 actually made it to closing.

That news came as a result of a Short Sale Lender Satisfaction Survey conducted in December 2010, and answered by 2,150 California REALTORS®. Of those responding, 94% said that they had participated in at least one short sale transaction in 2010.

Although there has been no follow-up survey to give us statistics for more recent years, we do know that laws passed in 2011 made it even more difficult to bring a short sale to closing. Under those new laws, second lien holders can only seek deficiency judgments after foreclosure. A short sale removes their opportunity to recover more than a small percentage of funds lent on second mortgages and home equity lines of credit. Thus, many second lien holders are reluctant to approve short sales.

As a result, it is more important than ever to seek help from an experienced and skilled California short sale negotiator.

The 2010 survey revealed overall dissatisfaction with lenders and loan servicers. And of course, that hasn’t changed. Some REALTORS® reported delays of more than 6 months in getting a written answer to a short sale request. Most reported a response time of just over 2 months. Nearly half of the REALTORS® responding said that lenders took more than five business days to respond to any form of communication, including telephone and email messages.

This should not be surprising, given that many agents work on only a few short sales per year and simply don’t have the experience necessary to deal with the banks.

REALTORS® who hope to succeed in handling short sales should learn all they can about each lender’s preferred procedures and then follow them to the letter. Submitting a short sale request in the manner that each bank prefers will help keep your request at the top of the pile. Mistakes will send it to the bottom.

As successful short sale specialists, we’ve also learned that it’s vital to develop working relationships with loan servicers in each bank. Because we’ve made the effort to develop these relationships, we can generally count on a response to our emails or phone calls within 48 hours.

We’ve handled hundreds of short sales for San Diego County homeowners over the past 8 years, and with good results. In fact, we’ve maintained a 98% success rate, even when dealing with banks that many consider the most difficult.

Success comes as the result of sound preparation and presentation, combined with persistence and strong negotiating skills.

If you’re underwater on a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, you may be wondering: Should I short sale or shouldn’t I?

Before you decide, call 619-929-1413 or write td@tomdunlap.com to get advice from Tom Dunlap – San Diego’s top short sale specialist.

We will be happy to explain the entire short sale process, show you the steps that lead us to success when others fail, and answer any questions you might have.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

I’ve stopped making payments. Do I have time to short sell before foreclosure?

Even if it’s late, it may not be too late.

If you’ve stopped making payments, you’re right to wonder if there’s time to short sell your San Diego home before foreclosure.

The answer is probably yes, as long as you list it at the right price and with an agent who is skilled in handling short sales.

In most cases, you’ll have 60 to 90 days from the time of your last payment before your lender begins the foreclosure process.

The first step in foreclosure is recording the Notice of Default.

By law, you have at least 111 days from recording of the Notice of Default until the trustees sale. However, home loans that were made between January 1, 2003 and December 31, 2007 have an additional 30 days, during which the lender is required to make a “best effort” to contact you for the purpose of exploring ways to avoid the foreclosure.

The Notice of Default can only be filed after this 30 day period, and the lender must attest to having made contact or having made a best effort to make contact.

Thus, if your mortgage loan was made between January 1, 2003 and December 31, 2007, you have at least 141 days.

Here’s the legal timeline of events that must happen before a foreclosure is final:

Within 10 days after recordation, the lender must send a copy of the Notice of Default to the borrower by registered or certified mail.

At some time between day 86 and day 91, the lender must record the Notice of Trustee’s Sale. This notice sets forth the date, time, and place of the Sale – which cannot be sooner than 20 days after recording. This notice must include the total amount of the unpaid balance and reasonably estimated costs, expenses, and advances at the time of the initial publication of the Notice.

Every effort must be made to notify the borrower of the impending sale. After the notice is recorded it must be posted on the property, published for 3 consecutive weeks in a newspaper of general circulation, and mailed to the borrower by registered or certified mail as well as by first class mail.

Day 105 – or 135 if the loan is subject to the 30 day contact period – is the last day for the borrower to cure the default and reinstate the loan by catching up all back payments and paying the related fees, late charges, etc.

Note that this is 5 days prior to the trustees sale. If that sale is postponed – which is relatively common – then the date to cure the default is also postponed to a date which is 5 days prior to the trustees sale.

Note also that the borrower has the right to redeem the property by paying the entire balance due, including fees, right up until bidding begins at the trustees sale.

If you have a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego and believe you should short sell, call 619-929-1413 or write td@tomdunlap.com.

We’ve created systems for presenting our short sale packages and we’ve developed relationships with the banks that allow our San Diego short sale requests to be processed faster than most, but it’s still best to have as much time as possible.

P.S. You may have read stories about San Diego homeowners who stopped making payments and stayed in their homes for more than a year before foreclosure. Those stories are true, but they are not a guarantee. It’s safest to proceed as if events will be carried out according to the legal timeline.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Does your short sale real estate agent know how to prepare a HUD-1?

In a standard real estate transaction, the HUD-1, also called a settlement statement, doesn’t appear until just prior to closing.

This document, usually prepared by the escrow officer, shows the financial accounting on both sides of a real estate transaction. It lists all the costs on both the buyer and seller sides, and is used as a guide in dispersing funds after the sale has closed.

But that’s not the case for a HUD-1 in a short sale.

The HUD-1 has to be prepared and submitted to the lender’s asset manager along with the short sale request. Why? Because a short sale lender won’t agree to the selling price until they know exactly how many dollars they will net from the sale.

Unfortunately, many San Diego real estate agents don’t have the experience to accurately anticipate all the costs that can crop up during escrow – and don’t know how to prepare a HUD-1 for a short sale even if they did. After all, the HUD-1 preparation isn’t part of their duties in a non-distressed sale.

That lack of knowledge often leads to the failure of the short sale.

If the HUD-1 is improperly prepared and unexpected costs crop up after the lender has agreed to a short sale, the transaction will halt and go right back to the negotiating stage.

That means another long delay and often leads the buyer to cancel the contract. Even worse, it can add enough time for a pending foreclosure to be finalized.

The HUD-1 is just one of the reasons why San Diego home sellers should always choose a listing agent with the experience and know-how to handle a short sale. If an agent doesn’t understand it and doesn’t follow the correct procedure, attempting a short sale can end in foreclosure.

We do understand San Diego short sales and we do know how to prepare a HUD-1 for a short sale. In fact, we’ve successfully closed 98% of the short sale listings we’ve taken in the past 9 years.

San Diego short sales aren’t fast or easy. But they’re not impossible, and they don’t need to take a year to close. You just need an experienced agent who knows how to deal with the banks in a manner that gains their cooperation.

So if you’re thinking of short selling a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, get in touch. We’ll be glad to explain how a San Diego short sale works and answer all your questions.

To reach us just call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What does it cost to list my San Diego home as a short sale?

Have you been approached by a real estate agent offering to put your San Diego home on the market as a short sale – for a fee?

Unfortunately, many have. And it shouldn’t have happened.

The truth is, San Diego homeowners who enter in to the short sale of a home don’t have to pay a dime. Reputable agents don’t charge a listing fee, and the selling costs, including commissions, are all paid by the mortgage lender from the proceeds of the sale.

The only costs that should be associated with the sale are those the homeowner incurs as a part of getting the home ready for market. For instance, you might pay to have the carpets shampooed or invest in some new paint to brighten up the kitchen.

Why would the bank pay your selling costs?

For one thing, they know that in most cases the homeowners don’t have the required funds. Secondly, the costs to the bank are far less than they’d pay as the result of a foreclosure.

With a foreclosure, they have to pay attorney fees and property preservation fees in addition to the real estate agent’s commission, title insurance fees, etc. Then, because it’s a foreclosure, the selling price will probably be lower. According to a study by the Boston Consulting Group, a short sale reduced a lender’s losses by 20% over a foreclosure.

Thus, paying the short sale agent is simply a good business decision on the part of the bank.

The good news is: Even though it costs you nothing, you can still obtain expert help for the short sale of your San Diego home.

We have a 98% success record in selling and closing the short sales we list. So if you own a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego and are considering a short sale, get in touch.

To reach us, call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Should You Keep Making Payments on an Underwater San Diego Home?

Are you among the hundreds of San Diego homeowners who purchased your home at or near the top of the market – and now, even though prices are rising, owe far more than the home could bring in a sale?

Were you led to believe your home would go up in value, and that it would be easy to refinance out of your adjustable rate mortgage before the interest rate reset? Even if you have a fixed rate mortgage, you’re probably frustrated because your house is “underwater” so you can’t refinance into today’s low rates.

Why are you continuing to pay?

If you’re in this situation, you may be asking yourself why you’re continuing to make payments when it could be years before your home is again worth it’s purchase price – or even its mortgage loan balance.

You’d probably like to keep the home – but pay less.

You’d probably love to get a loan modification with a principal reduction and a fair interest rate – so you can make payments on your home based on its value in today’s market. Unfortunately, banks aren’t interested in making principal balance reductions.

We know, there’s some talk of principal reductions in the new news coming out of Washington. At this point, it’s just talk, and it only applies to a handful of borrowers.

Meanwhile, banks resist principal reductions because they have to be written off on the books immediately. That hurts the company’s reported earnings – and reduces the CEO’s ability to get a bonus at the end of the year. It could even threaten his job.

An interest rate reduction (which is temporary) shows a much smaller loss – and thus makes a much smaller impact on the CEO’s bonus.

In addition, experience has shown us that most loan modification attempts fail – sometimes after causing financial devastation for the homeowner. For many, foreclosure is the final result of a loan modification attempt.

Offering your home as a San Diego short sale is a better plan.

First, when you short sell, neither your first nor your second lien holder can come after you for a deficiency judgment. If you let the house go into foreclosure, that second lien holder can demand payment.

Second, a short sale has a smaller impact on your future. Your credit scores aren’t as severely damaged, and you’ll be eligible for a new mortgage loan in as little as 2 to 3 years. After a foreclosure, you’ll wait 5 to 8 years.

Now that second lien holders can’t demand deficiency payments, it takes a strong negotiator to get them to agree to a short sale. There’s no doubt that short sales demand a greater commitment and greater expertise from your REALTOR®, which is why you hear so many stories about the difficulties of closing short sales – and why you need expert assistance.

As San Diego short sale specialists, we have developed methods for approaching the banks so that our clients can sell short, even with second mortgages, and even when they have both assets and income. In fact, we have a 98% success record in closing the short sales we list.

Every short sale situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com.

We’ll be glad to explain in detail how the San Diego short sale process works, and to answer all of your questions. So contact us today.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What Would Dave and Suze Advise About a San Diego Short Sale?

You probably know Dave and Suze from TV and radio. Dave Ramsey’s popular radio program answers questions from callers about how to get out of debt, and stay out.

Suze Orman wrote “The Courage to Be Rich,” and other books on personal finance. She also has a popular TV show where she answers people’s questions on how to manage their finances.

Dave and Suze do recommend short sales. They also recommend getting out of debt as quickly as you can. They see no point in using up a large percentage of your income on interest payments. Their advice is almost always “If you can’t pay cash for it, don’t buy it.”

In fact, Dave is such a proponent of the debt free, simple life that one of his favorite sayings is: “You don’t need to see the inside of a restaurant unless you are working there.”

But there’s one more reason why you should short sale your home rather than letting it go into foreclosure.

That reason is called deficiency.

A deficiency is the difference between what you owed on the mortgage and how much money the bank realized after re-selling the home and deducting all the costs of the sale.

If all you have is a first mortgage, you don’t have to worry. But if you’ve taken out a second mortgage – such as a home equity line of credit – a foreclosure could spell financial disaster.

In a short sale, neither lender can come after you for a deficiency. In a foreclosure, the holder of your second mortgage can sue for a deficiency judgment – and that’s not something you want.

Finally, a short sale is easier on your credit scores, and your future ability to own a home. After a short sale, you’ll be eligible for a new mortgage loan in as little as 2 years. If you allow your San Diego home to go into foreclosure, it will be 5 to 7 years before you can buy another home.

Should you short sale or shouldn’t you?

If you own an upside down home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, call 619-929-1413 or write td@tomdunlap.com to get advice from the Tom Dunlap – San Diego’s top short sale specialist.

He’ll be happy to explain how short sales work and to answer all your questions. Tom and his team have helped hundreds of other San Diego homeowners avoid foreclosure – and they’d be pleased to help you.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

If I short sell my home, will I have to pay the property taxes that are in arrears?

No, when you short sale your house, you won’t be expected or asked to pay the San Diego property taxes.

This is one of the costs that the lender will pay in the course of the short sale.

Property taxes are a first lien and have to be paid – whether the homeowner does a short sale or the bank forecloses. They can’t be negotiated away.

The fact that they are a first lien is why most lenders require home buyers to agree to setting up an escrow account as part of the monthly mortgage payment. When homeowners deposit 1/12 of the taxes each month along with their mortgage payment, the money is there when the tax bill is due. And, when the bank mails the payment, they know it’s been done. Most also want to collect monthly for homeowner’s insurance, in order to assure that “their asset” is covered.

We have not yet run into a San Diego short sale in which the bank required the homeowner to pay the property taxes – even if they were 2 or 3 years in arrears.

If you’ve already fallen behind, there’s a very good reason to call us today.

  • We have a 98% success record in successfully closing our San Diego area short sales. But even we can’t help if you wait until the week before a foreclosure becomes final.

If you’re in distress over a home in Carlsbad, Coronado, La Jolla, Rancho Bernardo, North County, Del Mar, Mission Hills, Kensington, Metro San Diego, or downtown San Diego, we can help you short sale your house and avoid foreclosure.

To reach us, call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to answer all your questions and to explain the short sale process.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What About Strategic Default?

Considering Strategic Default of your San Diego Real Estate?

Strategic default is often a sound financial decision. And in almost every case, selling as a San Diego short sale is a better decision than simply letting the property go into foreclosure.

Thousands of San Diego property owners have come to the realization that continuing to make payments on their homes, second homes, and residential rental properties might not be a wise business decision. And, there are times when sound business decisions should outrank other considerations.

Strategic default is generally thought of as the decision by a homeowner or investor to let a property go into foreclosure, whether or not they have the ability to continue making payments. But contrary to what many believe, such homeowners can also choose the short sale method of strategic default – and with far better consequences.

Some San Diego property owners have both assets and income – they are able to continue making the payments. But for many, the property has lost so much value that continuing to service the debt does not make good financial sense.

In the long run, making the effort to short sell is worthwhile. Here are a few of the reasons why:

  • A foreclosure is far more damaging to your credit scores – and for a longer time
  • A foreclosure will prevent you from securing some kinds of employment
  • After a foreclosure, you’ll be ineligible for a new home mortgage loan for 5 to 7 years
  • After a short sale, you’ll be able to get a new mortgage loan after only 3 years

Some San Diego homeowners are now making monthly mortgage payments that are roughly double what their next door neighbors are paying for a similar home purchased recently. Worse, their homes are often worth less than the balance they owe on their mortgages.

No two situations are exactly alike. When you want advice that applies to your specific situation, call 619-929-1413 or write td@tomdunlap.com to request a no-obligation consultation.

Some rental property owners should also consider a strategic short sale.

Faced with competition from investors who purchased in the last few months, many are being forced to lower their rents. Properties that were once San Diego income earners are now a monthly drain on bank accounts. Owners are writing checks to make up the difference between rental income and the mortgage payments, taxes, insurances, HOA fees, and special assessments.

For some it means using every last dollar and forgetting about such things as saving for retirement or college tuition for the kids. For those whose income stream has been severely reduced, it could mean going a little farther into debt each month on credit card accounts, just to keep food on the table. And, making those payments could bring a serious and negative result in their future and their loved ones’ futures.

It might not make sense to risk all of that for a property that will not cash flow for many years.

Thus, some rental property owners as well as San Diego homeowners are considering “Strategic Default” as a wise business decision made to protect themselves and/or their families from future financial devastation.

In spite of what you may have read, banks do allow short sales on investment properties and second homes as well as primary residences, and they do allow short sales for owners who have both income and assets.

And, while inexperienced real estate agents will tell you it can’t be done, we have negotiated short sales involving debts of $100,000 and up to $4 million.

If you’re considering a Strategic Default Short Sale in San Diego County, call 619-929-1413 or write td@tomdunlap.com to get advice from the short sale expert who says “Yes, we can” – and does it.

Every San Diego short sale, and especially every high dollar short sale, is unique and requires a unique strategy and approach. One size definitely does not fit all. And that’s probably why you’ve heard so many stories of failure.

Perhaps the biggest mistake anyone can make when attempting to short sale their property is choosing an inexperienced agent. And even choosing an agent with success in short selling low to moderately priced San Diego homes can result in failure with a luxury home, a second home, or an investment property.

We are San Diego short sale specialists. Unlike many REALTORS®, we don’t subcontract out our short sale negotiations, but handle all negotiations in-house. Through our experience in handling hundreds of short sales, we have developed effective processes for dealing with high dollar San Diego short sales. As a result, we have a 98% success rate.

Preparation, Presentation, and Skilled Negotiation Lead to Strategic Short Sale Success

When the request is presented properly and negotiated skillfully, bank negotiators usually conclude that allowing a San Diego short sale is the best business decision for them, as well as for the property owner. And of course it is. Foreclosure is not without cost to the bank, and a vacant home requires maintenance and upkeep. Then, it sells for a lower price than an occupied home.

During the past 9 years of handling short sales, we’ve learned that each bank has a different way of handling short sales. Some are aggressive on certain issues and not on others. Our knowledge of these differences is one reason why we succeed in closing San Diego short sales while others fail.

By knowing their policies and procedures, and by knowing who to contact at each bank, we can present the picture in a manner that leads to “yes.”

If you think a strategic short sale might be the best solution for you, call 619-929-1413 or write td@tomdunlap.com to tell us your situation and send us your questions. We’ll be happy to explain the short sale process, answer your questions, and let you know what information will be required from you in order to submit a winning request package to your bank – or banks.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

When should I consider a San Diego short sale?

As a San Diego homeowner, When should I consider a short sale?

If the current market value of your home is less than the balance due on your mortgage you should consider a short sale as soon as you know you will be unable to continue making payments without borrowing from other sources.

If things are tight and you don’t see the light at the end of the tunnel, its time to look at your options.

Don’t wait until a foreclosure is threatened, and don’t use up all your resources and/or borrow from other sources in order to maintain payments on a home that you cannot keep.

An important point to note is that a homeowner seeking to do a short sale must demonstrate that they are unable to continue making payments on the mortgage and that the circumstances that prevent payment were unforeseeable and occurred after the property was purchased.

Although some real estate agents will tell you it can’t be done, homeowners with both income and assets are often allowed to dispose of property through a short sale. Visit our strategic default page for further information.

There are no hard and fast rules, because every short sale situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com to ask your questions. We’ll be happy to answer them and to explain the short sale process.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What Are The Alternatives to Foreclosure?

What can I do if I want to avoid foreclosure?

Walking away and letting a home go into foreclosure will destroy your credit rating for many years – and even longer if you get stuck in a zombie foreclosure. Let’s take a look at the other options for San Diego homeowners:

  1. Sign a deed-in lieu of foreclosure.
  2. Work with the lenders for a loan modification
  3. If you have an FHA loan and are unemployed, apply for forbearance
  4. Offer your home as a short sale

A Deed-in-lieu – This is a document that essentially hands your San Diego house back to the bank without going through the foreclosure process. Your bank may or may not allow you to do it, but even if they do, it’s not a good move. The effect on your credit rating will be the same as a foreclosure. Worse, if you have a non-purchase money second mortgage, the bank can come back on you for a deficiency.

Loan Modifications:
Although highly touted as the answer to the mortgage crisis, in reality few have been helped and many have been harmed.

In theory, the lender would alter your interest rate and lower your payments for a set time, allowing you some “breathing room” in which to get your financial life back in order.

In practice, thousands of homeowners have been “strung along” for months, only to be rejected – even after complying with all the terms during a trial period.

That doesn’t mean you might not be successful, and we on the San Diego Pro Team will be happy to explain the process to you and help you determine whether the bank would consider your application for modification. We have the same software the banks use, and we’ll give you the results instantly.

Forbearance: This is a wonderful tool for anyone who has an FHA loan and is unemployed. The bank simply suspends your obligation to make payments for a year. The unpaid interest is tacked on to the end of the loan.

During the forbearance period you are free to market the house for sale – without the threat of an impending foreclosure. This is true whether you have equity or need to short sale your house.

A Short Sale: Although the current market value of the house is less than the balance due on the mortgage or mortgages, the bank approves the sale and accepts the proceeds as payment in full.

Here in California the first mortgage and any secondary liens are wiped out by a short sale. After foreclosure, your secondary lien holders can obtain a judgment against you for their unpaid balance.

The short sale of a home does require extensive negotiation with the bank’s asset manager, who might be more inclined to force the homeowner into foreclosure. That’s why homeowners need an experienced agent at their side. We of the Tom Dunlap Team have the experience – and an enviable record of success in getting our short sale listings sold and closed.

Note that in a San Diego short sale, all costs of selling, agent fees, unpaid taxes, etc. are paid by the lender from the proceeds of the sale. When you short sale a San Diego home, you pay no costs beyond the expense of keeping the house ready to show to potential buyers.

What are the Odds of Success on a San Diego Short Sale?

When you have the right assistance, the odds are very good.

The successful short sale of a home begins with knowing each lender’s preferences and how to present the short sale package so that it gets timely and favorable attention. Then, it depends upon negotiating skill and persistence.

Tom Dunlap  is San Diego’s leading short sales specialist. He has negotiated thousands of real estate transactions and has a 98% success rate when negotiating with lenders on a short sale.

It’s no wonder – he not only has more than 25 years of experience in helping San Diego homeowners, he’s also an attorney and holds a Master’s Degree in Negotiation.

If you have questions about loan modifications, forbearance applications, or short sales – or if you’d just like to discuss the San Diego real estate market – please get in touch.

Call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What possible tax issues might I have with a short sale?

The income tax issue resolves around forgiven debt in the short sale of a home.

Any time a debt is forgiven, the creditor will generate a “debt forgiveness” 1099 for the debtor. This is true whether the forgiven debt is unsecured credit or a mortgage loan.

The IRS requires all financial institutions to generate a debt forgiveness 1099 regardless of whether the taxpayer will be required to pay Federal Income Tax on the forgiven debt. So when you receive this document, don’t panic.

In general, if the debt was a home mortgage, it’s likely that you won’t owe the tax. However, there are qualifications in the law, so don’t assume anything.

Following is an overview of the rules.

Please do read the indicated IRS publications and seek specific advice from your own tax accountant or attorney.

Tax consequences of the short sale of your primary residence under Internal Revenue Code Section 121:

The San Diego short sale homeowner can find some basic information on the Mortgage Debt Relief act of 2007 at IRS.gov. This Act was set to expire on December 31, 2012, but has been extended several times. It now expires on December 31, 2016. Will it be extended again? We don’t know, but judging from past performance, we may not find out until late into 2017.

Generally, the Act allows taxpayers to exclude income from the discharge of debt on their principal residence. You will be required to acknowledge the 1099 on your Federal Tax Return, but will then file another form to offset the liability.

Debt reduced through mortgage restructuring, debt forgiven during the short sale of a home, and mortgage debt forgiven in connection with a foreclosure all qualify for the relief.

Short sale on San Diego rental property

IRS Form 982 is used to reduce the liability of a tax attributed to the sale of a property that results in a loss. See Section 108 of the IRC. The seller of a rental property needs to be prepared to use this option to avoid tax liability, if any. Section 108 specifically qualifies real estate for business purposes and paves the way for the tax payer to avoid liability for phantom income associated with rental property.

The second home short sale dilemma

The second home presents a true issue with regard to short sale and tax planning. The borrower who needs to go into a short sale on a second home should seek tax counsel and explore whether the property might be converted into rental property and qualify under the example above for rental properties under Section 108.

The IRS and cancelled debt

For more information on the IRS and cancelled debt, refer to IRS Publication 4681: Canceled Debts, Foreclosures, Repossessions, and Abandonments – specifically the sections on Qualified Real Property Business Indebtedness and Qualified Principal Residence Indebtedness.

Consideration of a short sale does bring about questions… call 619-929-1413 or write td@tomdunlap.com to get specific answers to your short sale questions.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What possible credit issues might I have with a short sale?

No two San Diego homeowners who short sell will experience the same effect on their credit scores.

After the short sale of your home, the consequences with regard to your credit rating are impossible to predict. If anyone tells you otherwise, they are wrong.

As much as we’d all like to make accurate predictions, credit reporting cannot be generalized, and the formulas used by Fair Isaac to create FICO scores are a closely held secret.

We do know that FICO scores are a mathematical assessment of your credit performance over time, combined with a snapshot of your credit use on that date. No two people would have the same snapshot, so each element of a short sale will have a different impact, depending upon the other facts contained in your credit report.

What is clear…

However, after more than 25 years’ experience in working with and observing credit scoring, it looks clear that a short sale and a foreclosure do not compare to each other. A Deed in Lieu or a Foreclosure will, in most cases, always end up with a very harsh result.

When it comes to short sale consequences, the seller in default is more likely to experience a lower credit rating than the seller who succeeds without missing any payments. However, the seller who is not missing payments might not be able to argue that there is any hardship and thus may not be allowed to short sale.

Regardless of whether the homeowner was in default or not, short sale consequences are always less severe than the consequences of a foreclosure.

A recent San Diego Homeowner pointed out that one of the great bonuses to using us for San Diego short sales is that we use the services of one of the nation’s premier credit repair firms. These credit specialists offer pre-short sale counseling to help you avoid mistakes that will further damage your credit.

A credit trap to avoid:

One of the largest single mistakes made by homeowners in distress is waiting to act and amassing unsecured debt in order to keep making payments on the house.

For instance: We had a Rancho Santa Fe resident call us to sell his home as a Short Sale. He had been trying for more than a year to obtain a loan modification and had now been notified that ASC had rejected his request. In the meantime, he had used up his credit limit on three credit cards. He was deeply in debt.

We were able to short sale the house and zero out any liability from his mortgage debt, but he is still faced with hefty balances and payments on three credit cards. Using the cards to their limit harmed his credit scores. If he is unable or unwilling to keep up with the payments, his scores will suffer even more.

The bottom line: If you think you are headed into housing trouble, act early. Save your resources.

The effect on your credit is just one of the many questions and concerns you may have as you contemplate the short sale of your San Diego home. We do have answers, so call 619-929-1413 or write td@tomdunlap.com.

We’ll be glad to discuss your situation, explain the short sale process, and answer your questions.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

How long does a short sale take?

How long does it take a bank to approve a San Diego short sale?

We tell everyone that it will take 90 days from the time of the offer to get an approval from the banks. Sometimes this happens in 60 days. Some banks are more organized than others and can even pull it off in 30 days.

The reason so many San Diego real estate agents will tell you bank approval on the short sale of a home can take 6, 9, or even 12 months or more is that their short sales were not properly presented to the lender’s asset managers.

Each bank has their own real estate short sale process and their own preferences with regard to how a package must be presented. When agents fail to follow those preferences, their short sales are delayed.

We’re experienced in presenting our San Diego short sale packages correctly the first time – so there are no unnecessary delays.

Every short sale situation is different. If you’d like specific answers that relate to your situation, call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Will I be able to buy another home after a San Diego short sale?

The short answer is “Yes, after a San Diego short sale you will be able to purchase another home.”

The big question is “When?” And the answer is: “It depends.”

One of the benefits of a short sale vs a foreclosure is that the time is much shorter.

However, confusion abounds with regard to how long you’ll have to wait before you can apply for a new San Diego home mortgage. Fannie Mae and Freddie Mac each have their own guidelines, as do FHA and VA.

FHA guidelines state that borrowers who were in default on their previous mortgage will not be eligible for a new FHA loan for 3 years. If they were not in default on their home mortgage or any other debt, they may be eligible in 2 years. But… depending upon the circumstances, they “could” be eligible almost immediately.

VA regulations state that you must wait 2 years.

Fannie and Freddie have relaxed their guidelines, dropping the wait time from 4 or 5 years down to 2 years – maybe.

It has been our experience that most people will wait 3 years before being granted a new home mortgage loan of any kind. However, since each person’s situation is unique and the guidelines are filled with “if’s, and’s, and but’s,” you should consult with a reputable mortgage lender to see just where you stand.

The first and most obvious requirement for getting a new San Diego home loan sooner is that your credit is good. If during your short sale you kept your mortgage payments and all other obligations current – and if you have continued to pay all your other obligations on time – you’ll get a new loan sooner.

As with any loan, your debt to income ratios and the stability of your employment will play a part in the decision.

The amount you can pay as a down payment will affect your chances with Fannie Mae and Freddie Mac. Those with a 20% down payment will get a loan sooner. Those with less than 10% down will have a much longer waiting period.

Your reason for the short sale also affects the timing of a new loan. If you can demonstrate that your short sale was the result of circumstances beyond your control, you’ll get a new loan sooner.

The good news is that a short sale will not destroy your chances of owning a San Diego home in the future. You can sell short, regroup, and move on to a brighter future.

We’re short sale specialists, with hundreds of successful short sales to our credit.

We can help you too – but only if you make the first move.

So do it today – call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

Is it possible to just walk away?

Yes, it is possible to walk away. Under California’s new laws, when you go through foreclosure, the banks cannot sue you for a deficiency on your first mortgage. However, if you have a second mortgage or a home equity line of credit, they can. And they probably will.

(One of the benefits of a short sale vs a foreclosure is that when you choose to short sale your San Diego house, none of your mortgage lien holders can sue for deficiency.)

However, even if you don’t have a second mortgage, walking away and allowing your house to go into foreclosure is one of the worst possible choices you could make. It should not be done without careful consideration.

The pitfalls of a San Diego foreclosure…

Foreclosure will severely impact your credit rating for many years to come. This will not just impair your ability to purchase another home, it will affect your ability to rent, to get a job or a promotion, and even to order cellular telephone service or cable television.

In addition, if you’re in a “sensitive” job, it could cause termination.

As for your ability to purchase another home – mortgage loan applications used to ask if you had a foreclosure in the past several years. Now they ask if you have EVER had a foreclosure. If the answer is yes, you’ll have to supply even more information and may well be turned down for that loan.

A further danger is that you could be trapped in a Zombie foreclosure. Should this happen, bills on your foreclosed house will keep mounting, and you could remain liable for several years. Learn more about Zombie foreclosures.

If you do choose to walk away, do NOT pay anyone to help you. Just call the lender and let them know.

If you’d like to discuss your other options, such as a San Diego short sale, a strategic default, or even a loan modification, do call call 619-929-1413 or write td@tomdunlap.com. We’ll be happy to talk with you.

What about the new “Walk away” program from Fannie Mae?

The new program is essentially a deed-in-lieu of foreclosure. The only thing new is that Fannie now says they’ll approve the process for homeowners who are not delinquent on payments.

The impact on your credit is still the same as a foreclosure, and it’s still a poor idea for California homeowners. Here’s why.

If you have specific questions you’d like answered, call 619-929-1413 or write td@tomdunlap.com. We’ll be glad to share the benefit of our experience in closing hundreds of San Diego short sales.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

How do you get paid when you represent me in a San Diego short sale?

As a short sale negotiator, how do you get paid when you represent me in a San Diego short sale?

All fees are paid by the bank. The bank will forgive enough debt to pay all costs of the sale, including REALTOR® commissions, title fees, etc.

Beware of agents who demand that you pay an up-front fee to short sale your San Diego house.

To learn more about how San Diego short sale agents are paid, and to ask other questions, call 619-929-1413 or write td@tomdunlap.com.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What happens if my second mortgage is really a San Diego home equity line of credit (HELOC)?

Special situations call for expert handling.

If you have a second mortgage on your San Diego home, especially a HELOC, it becomes even more vital to your future to avoid a foreclosure.

Under laws enacted in California in 2011, the bank cannot come after you for a deficiency on the first mortgage. The second mortgage is a different matter. They can’t come after you if you short sell, but they CAN come after you following a foreclosure. This is one of the primary benefits of a short sale vs a foreclosure.

Negotiating a short sale on a San Diego HELOC can be a little tricky, but we can and do accomplish this all of the time.

If you are a San Diego homeowner in distress and you have a home equity line of credit (HELOC), call 619-929-1413 or write td@tomdunlap.com to contact us today. We have extensive experience in dealing with every kind of San Diego short sale, and we can bring about a successful resolution to your situation.

We’ll be happy to explain the process and answer your questions – so don’t delay. A foreclosure simply costs too much.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What is an upside down mortgage?

An upside down mortgage is a mortgage in which the total amount you owe is larger than the amount you could realize if selling your property today at fair market value.

This is also called “being underwater,” and is very common among San Diego homeowners who purchased at the top of the market.

The only way to sell an “underwater” home in today’s market is through the real estate short sale process. In a short sale, the bank agrees to accept fair market value, less selling costs, for the payoff of your mortgage loan.

  • Do you wonder if you’re underwater – and if so, by how much?
  • Do you wonder if it’s too late for you to avoid foreclosure?

Call 619-929-1413 or write td@tomdunlap.com to tell us your situation and get answers to your questions.

What is a Deed in Lieu?

A Deed In Lieu is just that: a deed back to the bank in lieu of foreclosure.

You are simply calling the bank to say you are done and they can come get the keys to your San Diego home.

If you have one loan, you will probably be allowed to sign a deed-in-lieu. If you have two loans, this is usually not an option. Oddly, while you’d think they’d welcome the opportunity to avoid the costs of a foreclosure, most banks require homeowners to submit an application to be approved for a deed-in-lieu transaction.

But why do it?

From a credit standpoint, this could be one of the worst choices anyone might make, because it has the same effect on your credit scores as a foreclosure. And, as with a foreclosure, if your San Diego home has a HELOC or second mortgage, you could be held liable for a deficiency.

The difference is that you’ll have to move right away rather than wait for the bank to complete their months of paperwork. Thus, if you’ve chosen not to attempt the short sale of your home and are willing to bear the damage to your credit rating, why not stay in the house and save your money?

Waiting for the foreclosure and saving your money would help you pay off other obligations and have money on hand for the deposit and first months’ rent when you do have to move.

Of course, selling on a short sale is preferable if you’re trying to lessen the damage to your credit. Another of the benefits of a short sale vs a foreclosure or deed-in-lieu is that you’ll be eligible for a new home mortgage 2 to 4 years sooner.

We’ve helped hundreds of San Diego homeowners complete short sales and we can help you. So call 619-929-1413 or write td@tomdunlap.com to ask questions and learn about the short sale process.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What is loan modification, and should I attempt it?

Before you decide to attempt a loan modification…
call 619-929-1413 or write td@tomdunlap.com for some no-cost advice.

A Loan Modification occurs when the bank modifies or changes the terms of your loan.

The most common modification is a temporary reduction in the interest rate and resulting payment.

As a result of massive Internet advertising and a variety of confusing news stories, many borrowers have a mistaken belief that a loan modification also is likely to include a big reduction in the amount owed. This is possible, but not likely. Statistics show that it happens in only 17.1% of all loan modifications.

Loan modifications sound good – but for many homeowners the attempt at modification has led to disappointment and greater financial loss.

When the Treasury launched the HAMP (Home Affordable Modification Program) in March 2009, they projected aid to up to 4 million homeowners within a few short months. However, as of January 2013, only about one million permanent modifications had been granted under the HAMP program. Overall, it has not been a huge success, nor has it benefited many homeowners. *

Proprietary modification programs implemented by mortgage servicers have produced slightly better results.

Due to confusion, poor record keeping, non-communication between bank employees, and lack of commitment on the part of loan servicers, some homeowners have found themselves in foreclosure while they thought they were working on a loan modification. Meanwhile, they’ve paid thousands in temporary modification payments.

Another reason for this failure is non-compliance by the loan servicers and a complete lack of enforcement by the government. The truth is that the financial incentive offered by the government for modifying a loan is far less than the financial incentive presented by foreclosure. The result has been thousands of preventable foreclosures.

Congressional panels and committees have put pressure on the Treasury to crack down on HAMP servicers who aren’t doing enough, and HAMP payments have been withheld from some of our largest banks.* But the abuse goes on.

If you’ve attempted a loan modification and failed, you need a “different than normal” approach to a short sale.Call 619-929-1413 or write td@tomdunlap.com to ask why. We’ll be glad to explain.

If “legitimate” programs weren’t bad enough, San Diego homeowners in distress also need to beware of Loan Modification scams.

Legitimate loan modification does not entail an up-front payment. Companies that promise to help you get a loan modification in exchange for a hefty up-front payment are simply scammers. If you’re contacted by such a company, run the other way.

They cannot and will not do anything that you cannot do for yourself.

*** NOTE: If you are facing imminent foreclosure, you might need professional assistance. Contact a trusted attorney. If a foreclosure is pending, you first need to make sure that the left hand tells the right hand to cancel it while the loan modification is in review.

Do it Yourself Loan Modification for San Diego Homeowners in Distress

THE FIRST STEP: Call the bank that has financed your home loan. Prepare to sit on hold for some time (45-60 minutes) and be transferred more than two or three times. Once you get the “right” person on the line, ask for the Loan Modification package and then ask them to list current programs that they offer.

Ask: “What should I know specifically about how your department works?”
Keep your requests simple and kill them with kindness.

THE SECOND STEP: Once you’ve received the Loan Modification package, READ and RE-READ it. Never assume that what you get in the mail is what you were promised.

THE THIRD STEP: Complete the package thoroughly.
Focus on this issue: WHAT CAN YOU AFFORD? The bank will judge what they think. If you cannot afford their basic bottom line, then you are wasting their time and yours.

The bank looks at debt to income (DTI) ratio — 80% of your net income (after taxes) divided by gross expenses, including monthly housing payment. That is THE trick: you must be able to afford what the modification might be OR you could burn a bridge.

Why? Because loan modification requires that you show you can afford the payments. Qualification for a short sale requires that you show you cannot afford the payments.

If you choose to follow the route of a DIY Loan Modification, keep in mind that you will basically be paying on one loan while the other balance sits frozen until you sell the property. If you eventually decide to sell, you will still have to pay the lender back.

Let’s say that you sell your home two years from now. If the value of your property has not gone up, you are back to square one looking at a short sale. And, two years from now, the climate for short sale approvals might not be so friendly.

THE FOURTH STEP: Before you submit the package, make a copy for yourself and make sure that the pages are in order.

THE FIFTH STEP: Cookie-cutter guidelines are issued that allow low-level employees to approve certain packages.

However, you need to take action and follow up on your case throughout the process. If you are asked to submit anything else in writing, do so within 48 hours to keep the file moving. Follow up with your point of contact every 10 business days. If you have not received a final decision after 30 days, escalate your case to the next level.

THE FINAL STEP: Once you’ve received an approval for your loan modification, you should receive initial paperwork. All should be well within 90 days. If not, something is wrong. Call the bank.

If you are a distressed San Diego homeowner and you aren’t sure if loan modification is the answer for you, call 619-929-1413 or write td@tomdunlap.com to arrange a no-obligation consultation and learn your options.

We’ll help you determine whether or not the bank would consider you for a modification and we’ll explain your other alternatives.
…………………..
*References: Jon Pryor on Newswire Dec. 7, 2011

Leslie Berkman in The Press Enterprise Jan 14, 2012


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.

What is forbearance?

Forbearance is the term used when the bank agrees to let the borrower stop paying for a set period of time.

Those missed payments, plus interest, must be repaid.

Many banks offer short-term forbearance for homeowners who are experiencing temporary hardship. This must be a hardship with “an end in sight.”

Homeowners who become unemployed are given more leeway and assistance.

As of July 2011, FHA servicers are required to extend the forbearance period for unemployed homeowners from 4 months to 12 months. New FHA regulations have also made it easier for unemployed borrowers to qualify. Borrowers who are turned down for forbearance have 7 days to appeal and / or to produce additional documentation to support the request.

In January 2012, Fannie Mae set forth similar guidelines, which became mandatory for their loan servicers as of March 1, 2012.Freddie Mac has now also extended their forbearance period to 12 months.

During the forbearance period, mortgage payments will be reduced or eliminated. Missed payments must be paid back over time at a later date, generally beginning 6 months after the homeowner has resumed making regular monthly payments.

The good news for homeowners who want or need to sell is that they are allowed to market their homes during the forbearance period. This allows time to find a buyer, negotiate with the lender if the short sale of a home is necessary, and complete the sale without fear of foreclosure.

If you want or need to sell or short sale your house during a forbearance period, talk with San Diego’s short sale specialists, the San Diego Pro Team.

Call 619-929-1413 or write td@tomdunlap.com. We will be glad to talk with you with no obligation.


Please note that the information provided on this San Diego short sale page is generic, academic information used for general information purposes and may not be construed as or relied upon as a promise for a specific outcome.

This site provides information about real estate, law, income taxes and credit scores as relates to borrowers in distress, short sales and similar situations. The site is designed to help users safely cope with their own needs. Information is not the same as advice — the application of law or regulations to an individual’s specific circumstances. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a lawyer, tax adviser or other specialist if you want professional assurance that our information, and your interpretation of it, is appropriate to your particular situation. The models in photographs accompanying the testimonials on this website are used for illustrative purposes and are not a personal endorsement.