Image: jscreationzs / FreeDigitalPhotos.net An urban myth spread through my son’s school that gangs were putting baby seats on the roadside with blankets over the car seats and when an unsuspecting soccer mom stopped by to help out, the gang supposedly would rob the mom. This turned out to be totally untrue, of course. An [...]
Estate planning and real estate in the Land of Lincoln
Category Archives: foreclosures-shortsales
FHA may tag Strategic Defaulters with Scarlet S for life
Okay, foreclosures are up 95% this year in Palatine, the town where I live. The high foreclosure rate in Palatine is because there are a lot of condos here. Many condos were purchased around or after the peak in June 2006. I would bet that more than half of those condo foreclosures were “strategic defaults” [...]
Strategic Default in Illinois: Q&A
One client had no problem deciding to strategically default on his Chicago condo due to a triple-witching hour of crime, an abandoned condo complex and a declining market that left the unit worth one-third what he originally paid. For most people, though, the decision to walk away from a property is not easy. Here are [...]
Strategic Default in Illinois – Last man out of a dead condo complex
I get many calls and emails from my blog, mostly from people near or in foreclosure. This week, I spoke with a guy who bought a condo in the city in 2006 (generally considered the market peak). Then, and now, he had a good job, but the Chicago neighborhood where he lives is overrun with [...]
Is HAMP loan modification program dying?
This is a well-written post on HAMP, the loan modification program. It talks about how HAMP appears to be dying due to “strategic defaults” (a person whose home is worth less than the mortgage just quits paying, without trying to sell it or modify the loan) and an overly complicated approval process. Fewer and fewer [...]
Will HAFA help speed up short sales?
It remains to be seem if the new HAFA program for short sales, which started April 5, 2010, will speed up short sales. Short sales were already speeding up a little on their own because lenders finally seemed to realize that with home prices nosediving, out of sheer self-interest, it was best to be less [...]
Short sales improving
In the last few weeks, short sales seem to be easing up a bit, meaning that some are actually closing. It seems that lenders are finally understanding that with prices in a free-fall, it’s better to allow a short sale than to let a property go through foreclosure. The new short sales rules will begin [...]
One less quirk to buying a Fannie Mae foreclosure
Last fall, I whined about how hard it was to buy a foreclosed property from Fannie Mae. It’s still true that Fannie Mae is a tough seller and a pain to buy from. (I have a Fannie Mae purchase now. It’s been weeks, but there is no signed contract. Unfortunately, that’s “normal”… ) Now I [...]
Investment property: When to file bankruptcy in a short sale or foreclosure
Short sales and foreclosures of investment properties are tricky. Timing is everything. Bankruptcy can be used to discharge the tax issues arising from a foreclosure or short sale, but the window of opportunity slams shut once the lender issues a 1099. In August 2009, I closed a short sale for a client. Like most short [...]
Unwelcome surprise: 1099 after foreclosure and short sale
There is an unpleasant after-shock from a foreclosure or short sale. A client received the 1099 below last week after the foreclosure of his home. Lenders will issue a 1099 to the borrower after foreclosure and, surprise, the client will owe income tax on the amount in the 1099. The client was quite distressed to [...]
