Legal Question in Real Estate Law in Georgia

Short sales are almost always a bad deal for you.

If a lender forecloses, nolt only is your credit ruined for 7 years, but it is very possible that you will then get sued for a deficiency and face garnishment of paychecks and bank accounts.

Instead of keeping on doing everything wrong, and you actually are making mistake afetr mistake, you need to sit down with a lawyer. If you want to walk from your house and address debts, you need to consider if Chapter 7 or 13 bankruptcy is the most advantagous way to do it (and, if not, what is the best route). See a lawyer in your area to evaluate what you actually should do.

You may also qualify for cash for keys and get cash when you move.

A short sale is a great deal for you - if it includes a release for the remaining debt. It happens, but it is unusual. Short sales are often very difficult to actually pull off for many reasons: difficulty in selling at any price, RE agents who don't market it because they wonder where there commission is coming from, lenders who find it easier to pass the buck rather than agree to a deal, etc. The lender may just want you to market the property to save them time later.

As far as the lender pursuing you after a foreclosure, very few are pursued (and the ones who are normally are targets with other assets or income). Sometimes it is an option to wait it out - you can always file a BR case at any point and avoid a judgment. However, you may instead get a 1099 for the forgiven debt as it is considered taxable income (though the reality is that many people can then avoid owing the tax).

There is one near-certainty in your position -- if you can't afford the house, it usually makes no sense in throwing more money in it, in or out of BR, or otherwise.

In Georgia, the lender may pursue you for the deficiency after foreclosure. There is no way anyone here knows whether your lender will pursue the deficiency without knowing who the lender is and the particulars of your situation. It's completely up to the lender whether they want to pursue it.

In Georgia, a lender does not have to show you (or a court for that matter) proof of anything prior to foreclosing. Instead, the lender simply has to give you written notice and advertise the pending foreclosure once a week for 4 weeks in your county newspaper.

A NOTE ABOUT SHORT SALES

Short sales are tough! Banks are not very responsive, ask for the same information and documentation multiple times, and it's hard to find motivated buyers in this market. With that said, short sales can be a great deal for you and should not just be dismissed!

Two of my clients recently closed short sales wherein they owed no deficiency to their respective lenders. There were common variables in both cases -- the clients were highly motivated to sell (they cleaned the properties, advertised on their own, etc), the clients hired realtors with short sale experience, they responded in a timely manner to lender requests (even if the requests had previously been honored), they sent daily emails to the lender for updates and approvals, and they hired me to review and negotiate all documents that the lender wanted them to sign to protect their interests and avoid a deficiency claim down the road. Had these two clients simply thrown up their hands and walked away (or declared bankruptcy), it may have been less hassle, but their financial future would look much different. In other words, had they just walked away, they would have regretted that decision a few years down the road.

Not everyone can short sale their home. If you cannot short sale your home, bankruptcy may be your only option. Don't wait to see a bankruptcy attorney until you have exhausted all your options -- go ahead and see one now.

Best of luck.*******The above is for informational purposes only and does not create an attorney-client privilege.*******