You’ve certainly heard and read many reports about defaults on mortgage loans. There are many reasons homeowners face such situations, some of which are completely beyond their control. There are also several solutions, but each carries a consequence.

In one example, a family had to relocate for an attractive job offer. The home they were selling languished in a slow market for over six months, and they defaulted because they couldn’t continue the mortgage payments.

Their agent negotiated a “short sale,” whereby the lender accepted an offer that was $10,000 less than the loan balance (rather than begin unpleasant foreclosure proceedings). In this case, it’s important to understand that the shortfall is considered “debt relief” and is reported as taxable income to the IRS.

Since the sellers didn’t have to repay that $10,000 to the lender, the IRS considered it the same as $10,000 income. This debt relief from a short sale is considered taxable to the borrowers, and the corresponding Form 1099 must be reported.

This is one of the simpler scenarios created by defaults or foreclosures, which are becoming more common as market corrections and rising interest rates prevail. No matter what reason you or someone you know might be facing default, it is absolutely critical to consult with a tax adviser and a trusted real estate agent before deciding how to proceed.

If you need information to assist you with your real estate decisions, call me at 1-800-724-7149 or e-mail to donkingsley@kingsleyrealestate.com; I will be happy to share our knowledge with you at no cost or obligation.

Don Kingsley, CRB, CRS, ABR
REALTOR©

Visit the Kingsley Real Estate website for more tips on buying and selling!

Sellers face any number of challenges, but what if you’re in the position of listing a modest home in what has become an “upper- end” community? You might not expect to fetch a selling price that compares to the McMansions that have popped up, but you might be surprised to learn that, if presented and marketed properly, you could get even more on a per square foot basis.

Most critical to selling success is pricing your home very carefully. Shooting for the moon at the outset can spell disaster later. The longer your home remains on the market, the more it will be perceived as “stale inventory” unworthy of consideration. Remember that you could be at a real advantage if you price your home fairly against pricey competition.

On the exterior, strongly consider employing a landscaper to bring your property up to par. First impressions still count! On the interior, pay attention to details. Finishes, paint colors, and wallpaper all contribute to the perceived style of your home. Hardwood flooring is a great barometer of your good taste, and is a highly desired feature among upper-end buyers.

A more modest home in an upscale area will naturally draw attention because of its perceived value as compared to the competition. With proper pricing, a positive attitude, and professional representation, you’ve got little to worry about!

If you need information to assist you with your real estate decisions, call me at 1-800-724-7149 or e-mail to donkingsley@kingsleyrealestate.com I will be happy to share our knowledge with you at no cost or obligation.

Don Kingsley, CRB, CRS, ABR
REALTOR©

Visit the Kingsley Real Estate website for more tips on buying and selling!

Remember playing “Monopoly”? “Do not collect $200!” became a household phrase. Sometimes, towards the end of the game, you might have sold a property to another player for half-price just to raise some cash.

In real life, you would never accept half-price for your home - or would you? What if you owed $88,000 on a home you wanted to sell for $100,000? Now what if a prospective buyer offers to buy it at a discount of 6% off the asking price? Although you would like to receive full asking price, you accept. You’ve just sold your house for half price!

How’s that? Your equity - the difference between the sale price and what you owe - is what you receive at closing. It can easily slip through your fingers at the hands of a buyer who is good at negotiation.

Allowing that 6% discount ($6,000), you are selling for a price of $94,000 while you still owe $88,000. That means you will receive $6,000 cash in hand at closing rather than the $12,000 you had anticipated - half price!

Perhaps the most valuable role played by a REALTOR® is that of negotiator. When you list your home, you empower the agent to represent you in any negotiations that take place. Expect the best from your agent and reap the financial rewards.

If you need information to assist you with your real estate decisions, call me at 1-800-724-7149 or e-mail to donkingsley@kingsleyrealestate.com I will be happy to share our knowledge with you at no cost or obligation.

Don Kingsley, CRB, CRS, ABR
REALTOR©

Visit the Kingsley Real Estate website for more tips on buying and selling!