The Nuts and Bolts of Real Estate “Short Sales”

foreclose.jpgRecent estimates indicate that possibly more than twenty-five percent of all homeowners are upside-down on their home mortgages, meaning that they owe more on their home loan or loans than the fair market value of the residence.  This makes it virtually impossible to sell at a private sale.  When a couple goes through a divorce or dissolution and needs to divide the assets including such a home, what are they to do?  One answer is to walk away from the house, which will lead to foreclosure litigation and a crippled credit rating.  Another possible answer is to complete a “short sale”.

A “short sale” is when a lender agrees to the sale of a property by the owner for less than the amount owed to the lender.  It means that the lender is willing to accept less than the amount owed.  Except for those lenders who are participants in the Home Affordable Foreclosure Alternatives Program (HAFA), the lender may or may not pursue the difference against the borrower.  If the lender does forgive the difference, it likely will not be considered as income by the IRS as long as it complies under the Mortgage Forgiveness Debt Relief Act of 2007(which … Read More... “The Nuts and Bolts of Real Estate “Short Sales””

12 Proactive Steps to Take If You Are Contemplating Divorce

12steps.jpgJason C. Brown, the publisher of the Minnesota Divorce and Family Law Blog, recently posted a very practical article outlining some important steps to take if you are anticipating filing a divorce action. I am grateful that he has allowed me to repost it here. I concur with his wise “nuts and bolts” type suggestions. Remember the old adage, “An ounce of prevention is worth a pound of cure”.  Plus, this “ounce of prevention” might well save you thousands of dollars in attorney fees!

Once you break the news of your desire to dissolve your marriage, interesting things may start happening at your house. Critical records and valuable items of personal property may suddenly vanish. It pays to be proactive to ensure that you have all the information you will need to move forward as efficiently as possible.

The wasted time and cost associated with hunting down missing documentation can be staggering. We’ve handled cases where everything from an expensive diamond ring to boxes of business records have taken a “vacation”. We almost always find them, but not without substantial effort. In cases where they are not found, the Court will impose substantial sanctions and assume the missing … Read More... “12 Proactive Steps to Take If You Are Contemplating Divorce”

Estate Planning For The Modern Family – Use Of The QTIP Trust For Second Marriages

qtip.jpgAs we all know, the typical family from the 1950’s television shows such as “Leave it to Beaver” have become a rarity over the years.  A couple celebrating their golden wedding anniversary is not so commonplace.  Today, approximately fifty percent of all marriages end in divorce.  In the traditional family, estates usually involve wills and the use of “joint and survivorship” ownership between husband and wife or “beneficiary designations” to ensure that upon the death of a spouse everything would pass to the surviving spouse.  However, in today’s modern family, there may be a second or even third spouse and children from prior marriages.  How does an individual take care of his or her current spouse yet protect his/her children from a prior marriage?

The problem with leaving everything outright to one’s spouse in such a family is that the spouse may presumably leave everything to a new spouse or to their own children upon their death, leaving the children from one’s prior marriage with nothing.  Even providing for one’s children in one’s will may not solve the problem because in Ohio a surviving spouse has certain statutory rights.  These include:  (1) the first $40,000 of the deceased spouse’s estate; … Read More... “Estate Planning For The Modern Family – Use Of The QTIP Trust For Second Marriages”

Need Free Legal Help to Avoid Foreclosure?

If you are behind on your mortgage payments and facing possible foreclosure on your home, there is an excellent program that the Ohio Attorney General’s office has instituted. The new program is called “Save the Dream”. You can call their hotline for help at 888-404-4764. Hundreds of lawyers statewide have volunteered to provide free legal services for Ohioans to help them avoid foreclosure actions. Be smart and avoid all those predatory lending “quick fix” offers that you see advertised on television or receive in the mail. They will only put you in further trouble!

I Want to Keep the House, But Should I?

This is one of the questions I am asked all of the time. Of course, the correct answer is “It depends.” The home often accounts for a large percentage of the entire marital estate. Whether to retain the home after a divorce is often a very emotional issue, especially if there are children involved. It is natural that parents want to maintain as much stability for their kids as possible when going through a break up. One would assume that keeping the kids in the marital residence after the divorce is important. But interestingly, the psychological studies show that divorced children are not really affected by the retention of the marital home. The key factor is the stability of their parents, not what house they live in.

It is important to realize that unlike spousal and child support, property division terms cannot by law be changed after the divorce is completed. The first step in the analysis is to prepare an accurate anticipated budget and determine if it is feasible to pay the mortgage, taxes, and utilities. Don’t forget to consider necessary repairs and upkeep to the home. Hiring a housing inspector to evaluate these future costs often makes good … Read More... “I Want to Keep the House, But Should I?”

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