A short sale is when your lender allows you to sell your house for less than what is owed to them, in order to avoid your home potentially going to Auction, which effects the lender's credit.

Due to the number of foreclosures that Lenders are dealing with on a daily basis, a short sale can take anywhere from 3-4 months. It is CRITICAL that you act fast to avoid the home going to auction. Lenders are not as accommodating when you get close to Auction.

What is a Loan Modification?

A loan modification is putting your delinquency at the end of your loan. There has been a lot of misleading information regarding modifications.

With the amount of foreclosures that Lenders are facing today, the process to get a loan modification has become easier for homeowners to get out of foreclosure.

To find out if you qualify, all you have to do is add up all of your monthly Income (net pay from all sources in your household), then add up all of your monthly expenses (Mortgage, Utilities, Taxes, Car payments, Credit card debt, Insurance, etc.)

If your INCOME is greater than your EXPENSES, then you may qualify for a loan modification.

It's as simple as that.

Once the loan modification process is started, it typically takes 4-6 weeks.

What happens to my Credit in foreclosure?

There are different impacts on your credit regarding foreclosure.

1. Auction - If you lose your home to Auction, your credit is damaged for 7-8 years. You will most likely not be able to buy another home during that time.
2. Bankruptcy - If you file bankruptcy, your credit is damaged for up to 10 years.
3. If you short sale your house, your credit can be repaired over 12-18 months. This allows you to potentially purchase another house in a shorter time frame.

As you can see, the impacts of Auction and Bankruptcy have a long term impact on your financial well being. We strongly believe that we can help your avoid long term financial problems!

What is a Forbearance Agreement?

A forbearance agreement is an agreement between the homeowner and the lender to work out a repayment plan on the amount owed to them. This is a solution that provides relief from a temporary setback such as job loss, divorce, health issues, etc.

How do Forbearance Agreements work?

Typically the way a forbearance agreement works is that a homeowner has to come up with a 30-50 % of the total delinquency. The remaining delinquency balance is then spread out over a 12 to 24 month period. This payment is in addition to your regular mortgage payment.

For Example if you are $12,000.00 delinquent in your payments your work out plan may look like:

$4,000.00 down payment and the balance of $8,000.00 will be spread over 24 months means your payment will increase $333.00 per month.

What's the new law that was just passed?

President Bush just signed into law a bill to help people that may be facing foreclosure next year. What that means is that if you are current today in your mortgage but you know that when your interest rate jumps March you'll be delinquent then you don't have to worry because this law is written to protect you. Unfortunately that causes two problems:

1. If you are currently delinquent, this law does not help you at all.


2. If you aren't able to afford your mortgage when your rate kicks up next year and rates are at historic lows today you run the risk that in 5 years when that rate adjusts you might be facing a significantly higher interest rate.

Should I pull money from my 401K?

We can't tell you what do financially however we do ask that you look at your situation logically. If you cannot afford your current monthly payment does it make sense to take whatever hard earned money you have set aside and use that to patch your situation temporarily. Even if the funds cover you for 6 months what happens after that? Now your 401K is empty and you're losing your home.

What are the Benefits of working with Illinois Distressed Property Solutions (IDPSLLC)?

There are many significant benefits. Here are the main ones:

1. Unlike just listing your property and waiting for a buyer IDPS, LLC has exclusive agreements with the largest Real Estate Investment Clubs in the country and many times they will actually have a buyer for your property within 5 business days.


2. Premiere Property Processing hosts a network of real estate agents that we work with, however we handle the short sale and all negotiations and the realtor focuses on finding the buyer. We work with Premiere Property to provide you with the best possible solution.

   This is a major benefit for you because many realtors don't have the experience to work with a lender on a daily basis to check the status of your file. Also, if your property already had an offer from one our investors we will already know the bottom line price the lender will accept so you'll have a leg up on everyone else that's listing their property.



3. We also work with a nationwide network of bankruptcy attorneys so if you need bankruptcy or other legal assistance we are there to help.

What are the Tax Consequences?

The deficiency balance from the sale may be taxable. The Mortgage Forgiveness Act of 2007 has been extended through 2017 and if passed again in 2018 or beyond, waives the tax liability. Most people in a short sale situation will qualify for insolvency which means their liabilities exceed their assets (excluding 401k/IRA assets in the calculation as they are protected). Seek guidance from an accountant for your situation.