What will happen to Orlando short sales if the Mortgage debt relief Act of 2007 is not extended?
Short sales have been very popular since the market crashed in 2007, mainly because sellers have the benefit of not being taxed for the deficiency between the mortgage amount and the actual payoff. What people worry about now is that the Mortgage Forgiveness Debt Relief Act of 2007 is about to come to an end at the end of 2012 and so far we haven’t anything about the government extending it.
What do you think would happen if the law doesn’t get extended? In my opinion, this would be the end of Orlando short sales as we know them.
When you think about it, what incentive would a seller have to do an Orlando short sale if they end up with a massive deficiency when it closes? That’s right… there would be no incentive. In fact, I think that most people will just end up letting it go to foreclosure. This means that Orlando REO realtors would be busier than ever.
Deep down I truly believe that this law will be extended, it just makes good business sense for everyone involved… sellers buyers, and lenders. Orlando real estate is moving right now and a big part of that is because of the short sale inventory.
If you are considering an Orlando short sale on your house, don’t take a chance on the mortgage debt relief act of 2007 being extended. Consult with an Orlando short sale specialist and find out what your options are now or you might regret it.
Jenny Zamora, Lic RE Broker. Orlando Short Sale Specialist
