“Walking away” involves making a deliberate decision to stop paying the mortgage, while giving up hope of holding on to the property. It’s a choice to let the foreclosure process proceed. 

With foreclosure, your credit report takes a hit of 125-240 points (depending on delinquencies or other factors) for seven years. With a short sale, the hit lasts for 3 years. After you stop paying your mortgage, other options such as loan modification may still be possible, and it’s best to act sooner rather than later to explore these. If all else fails, or your home is difficult to sell for some reason, then walking away is the last remaining, least-desirable choice. 

There have been millions of foreclosures in the United States over the last decade—you are not alone. Although it’s not what anybody intends when they purchase a home, it may become necessary at some point to take the hit, if the home has become unaffordable. 

In some cases there may be tax consequences for walking away, although the first $1 Million (or $2 million if filing jointly) was exempt under the Mortgage Forgiveness Debt Relief Act of 2007 (for primary residences).  Congress failed to renew the law in 2012. 

Another potential consequence is a “deficiency” suit brought by the lenders, in an attempt to recover the difference between the loan amount and the foreclosure or short-sale proceeds. Some states have complete consumer protections against deficiency suits, (known as “non-recourse” states). New Jersey doesn’t. 

The lender must file their deficiency suit within 3 months of the Sheriff’s sale in New Jersey. Invoking the fair market value of the property is a common defense against deficiency. If a judgment is awarded to a lender, the borrower has bankruptcy as a last resort option to wipe the judgment. 

Deficiency judgments are relatively rare when borrowers have few assets and poor credit, with lenders choosing instead to issue a 1099 to the borrower. The IRS views deficiencies as income to the borrower – unless the 1099 was filed in 2007-2013, in which case it is tax exempt. If a buyer is doing a “strategic default” such as walking away from an underwater second home – and has other assets and relatively good credit – the likelihood of a deficiency action increases substantially. 

WHAT CAN WE DO TO HELP? 

ADVANTAGES 

Your house can be sold in 48 HOURS. 

NO WAITING while it sits on the market! 

You know the price you are getting 
We pay all the closing costs

NO SURPRISES!! 

No chance the deal will fall through … Its Sold Now. 

No WORRIES about repairs or maintenance! Less stress. 

We Can Give Flexible Terms! 

My name is Shawn and I am the owner of Swift Home Buyers Co and we specialize in working with homeowners facing foreclosure. 

Call or text us at (609) 200-0221 or just respond to this email and let us 
help you solve your foreclosure problem today! 

Warm regards,

P.S. Click Here to get a copy of the Special Report “Five Ways To 
Avoid Foreclosure” 
https://www.swifthomebuyers.co/go/stop-foreclosure/ 
P.P.S Find out who we are and decide if you want to work with us. 
https://www.swifthomebuyers.co/our-company/