How will it effect 2 of my other properties if i do a short sale? liens? irs tax?

Question

I am going to do short sale for a condo i bought 2 years ago for 365k. Comparables are at 190k and not selling. i have two other properties. i have had for years and don't owe more than 200k combined. but comparables for those properties are about 600k and the other is 200k. i am retired so one of these properties is my only source of income. no pension, no ss. my ? is will the bank or irs try to take any of my properties or want to get some money?

Answer 1

I have never come across this kind of deal. AlI the people I ever did a short sale for didn't have such assets. I think the bank could come after the assets and the IRS could consider the short amount taxable income, I just don't know if they would. I know the IRS could have on a number of people, but didn't.

What the bank can do depends on the state.

This is beyond a realtor and you need a good accountant, and possibly a lawyer to get things exactly right. Do that no matter what you get here, because there is a lot of really bad advice given just to compete for a stupid best answer and it makes me want to throttle the super idiot who's going to mess with someone's financial well being just to give an answer that sounds good to someone who won't know the difference.

Go to a very good accountant and give them all the details, and ask them if you need a lawyer. There is a limit to what even an accountant or an honest lawyer will tell you to do, like they can't tell you to sell out and hide all your assets before you sell , and that could get you in real hot water too, so it's good they wouldn't. An unscrupulous lawyer or accountant who attempts to get you to pull some shady stuff is just as likely to take you for all they can as not, so be careful.

Wish I could tell you more, but that's the best stuff I have without really understanding every detail, and that probably wouldn't help either. Your best bet is the good accountant and a good lawyer if they tell you to go that way.

I wish you the very best, good luck!

Edit: Judy seems pretty knowledgeable and credible, I checked her out a bit and she's pretty solid so she is probably right. Still check with an accountant though, state laws do differ.

Answer 2

Since you have other assets, they will very possibly not agree to a short sale of the condo.