Home owners attempting to do a San Diego short sales prior to the passing of this law ran the risk of having second lien holders come after them for the deficiency amount of the short sale. The law is not retroactive to the best of my knowledge.
Currently, sellers in California that sell their homes that are secured by a mortgage and the home has no more than 4 units (single family, condominiums, duplex, triplex and fourplexes) can benefit from the new rules.
In the old legislation, despite popular hear say, after the sale a the second lien holder could come after the seller for the deficiency if they did not put it in writing in the San Diego short sales letter of approval. Many letters released the house so it could be sold, but not the San Diego short sales seller of the debt.
The current law states that if the bank accepts less than what they are owed, and they agree to do the short sale, they are also agreeing to release the responsibility for the seller and not come after the seller for the deficiency.
We have had great success even before the passing of sb458 in obtaining written instructions saying this to ensure sellers had no problems, which we continue to request today.
Unlike a foreclosure, a short sale will not show on your credit as a foreclosure, and you do not have to say that you had a foreclosure on credit applications. Furthermore the other benefit of a short sale is that there are loans that allow you to purchase a home the next day after the short sale closed if you did not fall behind on the payments of your home and your credit is acceptable.
The benefits of doing a short sale now outweigh those of considering a foreclosure and the legislators know it.
By doing a short sale with a San Diego Short sales specialist you
- Avoid a foreclosure on your credit.
- Can purchase a home as soon as the day after the sale of the house.
- You are no longer responsible for the deficiency.
- Banks, in some cases, will give you money to relocate.
- Your credit recovers quicker.
- You do not have to answer yes on credit aplications if you have not had a foreclosure.
- Banks prefer short sales over foreclosure.
- Banks pay for the San Diego Short sales agent fees.
- A short sale is done at no cost to you.
The full text for SB458 and how it affects San Diego short sales is here
[...] with the passing of SB458 in California where the debt in a short sale can no longer become a deficiency, or in case of Las [...]