Every agent you talk to has an opinion about short sales. Those who have been successful in getting them to settlement praise them and those who don’t rant that they will never touch them again. I try and read everything I can so when a question comes up from a prospective buyer or seller I can help them find an answer on what their options are.
In yesterday’s Washington Post there was an article that caught my attention on short sales that threw a potential new wrinkle in the mix.
Even though a bank provides a 1099C saying that there is no tax liablity on the difference between what you owe and the payoff are they really cancelling the debt? Is there any chance the bank might still come after you for the money?
According to the article in the Post there could still be a possibility that the lender could submit your name and information to a debt collection agency and go after you for the difference. Is that likely? If someone gives the banks the chance to try it they probably will.
Read the Washington Post article and see what you think.