{"id":2132,"date":"2011-09-23T07:22:19","date_gmt":"2011-09-23T12:22:19","guid":{"rendered":"https:\/\/nybankruptcy.net\/main\/?p=2132"},"modified":"2018-11-28T08:30:24","modified_gmt":"2018-11-28T08:30:24","slug":"short-sales-vs-foreclosure-in-new-york","status":"publish","type":"post","link":"https:\/\/nybankruptcy.net\/main\/short-sales-vs-foreclosure-in-new-york\/","title":{"rendered":"Short Sales vs. Foreclosure in New York"},"content":{"rendered":"

Many New Yorkers are falling behind or about to fall behind on their mortgage payments. For those whose equity was wiped out in the housing bust, the time to contact an experienced bankruptcy attorney is now and not later.<\/p>\n

Foreclosure is often viewed as the worst option. \u00a0However, short sales–a frequent path for many–may be a reasonable option in some cases. \u00a0Here\u2019s some additional perspective on the topic:<\/p>\n

A while back, the New York Times<\/em> ran an article on the difference between the two<\/a> and their effects on people\u2019s credit scores, which, for better or for worse, is the best gauge of the long-term consequences of the two.<\/p>\n

Foreclosure damages credit history significantly. The Times piece gives two examples. People can return to a 680 three years after foreclosure, if they make regular payments. Bringing a credit rating up to 780 takes seven years. Clearly this is a path that most homeowners would prefer to avoid.<\/p>\n

As a result, many homeowners may find that short-selling their homes, filing bankruptcy or offering their lenders their deeds in lieu of foreclosure to be more attractive alternatives depending on their circumstances. \u00a0And it\u2019s fair to say that these options, including bankruptcy, can actually be viewed as acts of fiscal responsibility relative to foreclosure.<\/p>\n

Short sales with no resulting mortgage deficiency have minimal impact on credit ratings. Those who take this route can potentially have manageable credit within nine months, provided they make their payments consistently. This may not be enough to qualify for a new mortgage, but it will open up other forms of credit options.<\/p>\n

It\u2019s worth noting that short sales sometimes have tax implications. \u00a0For example, if the bank forgives a deficiency greater than $600, it must file a 1099(c) form with the IRS. This informs the agency that it can tax the forgiveness as income, which is something homeowners contemplating short sales need to be concerned about.<\/p>\n

Speaking of new mortgages, the Times discussed the Fair Housing Administration\u2019s (FHA) guidelines for the wait-period between losing a previous home and receiving approval for a \u00a0new FHA mortgage. The wait-period for those whose houses went into foreclosure is seven years. By contrast, for those who file bankruptcy, the wait-period is only four years. Moreover, if the homeowner went into financial hardship due to lost jobs, illness, or divorce, the FHA creates exceptions that can reduce the wait-period to two to four years.<\/p>\n

What does all of this tell you? \u00a0That when it comes to foreclosure, short sales, deeds in lieu of foreclosure and bankruptcy, there\u2019s a lot to learn. \u00a0And seeking the aid of an experienced New York bankruptcy attorney is a proactive step that trumps passive inaction every time.<\/p>\n

For more questions about bankruptcy, the automatic stay, effective strategies for dealing with foreclosure, and protecting your assets in bankruptcy please feel free to contact<\/a> experienced\u00a0Brooklyn NY foreclosure attorneys<\/a> Bruce Weiner for a free initial consultation.<\/p>\n

<\/center><\/p>\n","protected":false},"excerpt":{"rendered":"

Many New Yorkers are falling behind or about to fall behind on their mortgage payments. For those whose equity was wiped out in the housing bust, the time to contact an experienced bankruptcy attorney is now and not later. Foreclosure is often viewed as the worst option. \u00a0However, short sales–a frequent path for many–may be …<\/p>\n

Short Sales vs. Foreclosure in New York<\/span> Read More \u00bb<\/a><\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"default","ast-global-header-display":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"default","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":""},"categories":[16,10,14],"tags":[],"acf":[],"yoast_head":"\nShort Sales vs. Foreclosure in New York<\/title>\n<meta name=\"description\" content=\"Many New Yorkers are falling behind or about to fall behind on their mortgage payments. 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