My Ex Is Short Selling. What Can I Do?

My Ex Is Short Selling. What Can I Do?

The Texas Group Realtors received this question form Dave short sales.

“My Ex-wife decided to Short Sell our former house. Unfortunately we both signed the mortgage when we bought the house together. I think that means I am still liable for the debt.

She got the home after the divorce. The court gave her the home in the divorce. The market has declined and the house is worth about 120k less than the mortgage amount.

I have a good job and some assets. Will I have to pay back the bank for the money they lose? (My ex is selling because of financial problems.)

Also, someone said I might have to pay income taxes on the written off debt. Is that true? Please help me out here. Sincerely, Dave.”

Email beth@txhomerealty.com to discover how other sellers successfully did a short sale and avoided foreclosure.

Here was our answer. Dave, you probably should talk to a good lawyer. This is not the standard short sale. There might be tax laws that will allow you to not be liable for the tax liability on the written off debt.

Your ex probably meets that criterion. I would think that since she lives in the house, then you wouldn’t be liable for the taxes. But, then again, I am not an accountant and don’t know how the law would affect such a unique situation.

Will you have a deficiency judgment? We can’t know for sure because there are so many variables involved. However, in about 80% to 90% of the time, you won’t have a deficiency.

That is because most lenders just forgive the debt. They have found it tough to collect the upside down debt. Most people are short selling because of financial problems.

They are struggling to avoid bankruptcy without a large deficiency judgment. When they see a $100,000 deficiency, then they will probably just declare bankruptcy. Then the lenders gets nothing anyways.

Check with a competent short sale realtor in your area. They will be able to give you a good idea of whether or not you will have to pay the deficiency. Thinking about a short sale?

I can help you short sale your property and get back on your feet. Send me an e-mail at beth@txhomerealty.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (469) 523-1402.

Discover how other sellers successfully completed a short sale in Cedar Hill, Desoto, Duncanville, Lancaster and request a free consultation by emailing phillis@txhomerealty.com.

Thinking about a loan modification? Our Dallas loan modification kit has the instructions you will need to get a loan modification approved with your bank. Email beth@txhomerealty.com.

Thanks for reading this, Phillis Nealy.

Phillis is a Real Estate Agent at The Texas Group.

Phone: (214) 650-5536.

A Realty company with Service as Big as Texas

View My homes for sale at www.southwestdallashomes.com

Important Notice

Phillis Nealy and The Texas Group Realtors are not affiliated in any way, shape, or form with the government.

This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing.