Foreclosure Information for: Sellers & Buyers
to Home Owners:
(foreclosure HELP numbers at
** DON'T let your home go back to the bank, without a fight!
** If the options below are not
helping you, don't give it back!
** I am a short sale specialists....I know how to sell your home!
** EVEN if you have a bankruptcy,
you are still going to have a
"FORECLOSURE" on your credit report!
** Selling under a short sale will eliminate that....you have to try!
** FYI - Craig S.....gave his house
back to the bank, he now has a
foreclosure on his credit report AND a collection company is now
after him to pay back his loan, and they will for years to come,
Craig DID NOT try and sell his home, he just gave it back to the bank!
**** DON'T MAKE THE SAME MISTAKE***
Listed are options for home owners facing foreclosure:
Loan Modification: Lender reviews your
situation, income, debts, and determines
if you qualify for “modifying your loan”.
Forbearance Agreement: Lender agrees
to adjust your payments to absorb your
Subject To: sellers beware...this is when
you sign over your home to someone
and they agree to make your payments
and agree to sell your home or refi it.
Deed in Lieu of Foreclosure: you sign over
your home to the lender. You may be liable
for a “deficiency” and your credit will show
“Deed in Lieu of Foreclosure” which is a
Short Sale: my specialty, I sell your
home for less than what is owed...you
owe $250K.....I sell it for $215K which
the lender agrees to accept. Does not
matter if there is a 2nd lien. You may
be liable for a “deficiency” which I
negotiate against for you!
IRS tells lenders to issue 1099 tax
statements for short sale amounts as
well as deficiency amounts. See my
letter from a CPA describing this as
Letter from CPA:
I also know a fair amount about short sales.
Short sales can be tricky, but for most of your clients who own the home as a
primary residence would have the entire gain or profit excluded because of
the primary personal residence rules which can apply every TWO
YEARS. (it’s not a lifetime thing at all). The amounts you have are
correct. Gain on sale of primary personal residence is excluded up to
those amounts on a sale or short sale once in each two year period. They
get to deduct from the sale price any sales expense such as real estate
commissions, title work, etc and the original cost plus improvements of
their residence for purposes of calculating the gain.
Most people don’t realize it but they could still have a profit, even if they
get no money. Usually though it will be below the excludable $250 or $500K limits,
and therefore not taxable.
In addition to the short sale situation, many of those clients may also be
insolvent, meaning all their liabilities exceed their assets. In such cases if the
gain might be taxable, and forgiveness of indebtedness is income; but if the
insolvency exceeds the proceeds, then taxable income may be avoided
Short sales can get tricky for rental properties because of depreciation
recapture and second homes do not qualify as personal primary residence. Clients
may be able to plan for these with help, including tax deferred exchanges or residence
I hope this makes some sense. Call if you have any further questions, or run into
some of those tricky situations.
Referrals of your friends and clients who meet my ideal client profile are obligatory.
David B. Gossett, CFP(r), CPA
PS. In addition to serving my existing clients like you, and now that I am also a Certified Financial Planner ® Practitioner, I am upgrading my practice to include the highest quality of financial planning service for a few more select clients. I have only a few openings for those that meet my ideal client profile attached. Please let me know who you know who may meet that profile. Thanks
Colorado Foreclosure Taskforce
Hot Line: 1-877-601-4673
Adams County Housing Authority
Broomfield County Housing Authority
Boulder County Housing Authority
Jefferson County Housing Authority
CO Rural Housing Development
303-428-1448 ext: 212
$5000 loan program - call Steve for details
To Home Buyers:
Call anytime: 303-912-5113