Our Attorneys Can Help You Make the Right Decision for Your Family

Homeowners whose mortgages are in distress urgently seek solutions of various kinds, including mortgage modifications and short sales. Since the mortgage crisis deepened in the latter half of the 2000s, there has been a lot of buzz about short sales. Through a short sale, a lending bank will agree to allow a homeowner to sell a house for the current market value, even if that value is less than what is owed on the mortgage.

Historically, the lending bank would often agree to release the homeowner from any resulting deficiency claims, but current trends are moving in the direction of lenders not releasing the homeowner from the remaining mortgage debt. A house that was purchased for $200,000 might be sold at a short sale for $100,000, for example, but the homeowner is likely to remain responsible.

If you are looking to get out from under a home you cannot afford, contact our Tampa bankruptcy lawyer today.

A short sale may seem like a tenable solution to borrowers who are unable to meet their monthly payments anymore for any number of reasons:

  • The mortgage was an adjustable-rate mortgage (ARM) and payments have risen out of reach of the borrower’s ability to handle.
  • A life situation such as a job loss, a business failure, a medical crisis or a divorce has dramatically reduced the borrower’s monthly budget.

However, there are many issues which can arise as a result of a short sale.

Short sales can leave borrowers with problems such as:

  • Without ironclad reassurance that a bank will release the borrower and dismiss the remainder of the mortgage entirely after a short sale, a borrower may need to look harder for a real solution.
  • Even if the lending institution does forgive a large portion of the original loan (which is less and less common), this forgiven loan may be considered income for taxation purposes. Mortgagees can end up with very large income tax bills.

Such problems do not exist when a borrow files bankruptcy. Whether it is Chapter 7 or Chapter 13 bankruptcy, a debtor does not have to pay income tax on any discharged debt or portions of debt eliminated through a Chapter 13 reorganization. Furthermore, a debtor who decides to let his or her home go into foreclosure while also filing bankruptcy has the benefit of being able to live in the home with no mortgage payments due while the foreclosure is progressing. A foreclosure usually takes a year or two to complete, so this year or more with no rent or mortgage payments can be a huge benefit to overwhelmed debtors.

Discuss your mortgage problems, your bankruptcy and the possibility of a short sale with an experienced Tampa bankruptcy lawyer at Debt Relief Legal Group we have helped many debtors navigate the system and emerge from foreclosure and bankruptcy with a fresh start. Rest assured that if we believe that a short sale is in your best interests, we will of course advise you accordingly. We will never urge a client to file bankruptcy or allow a home to go into foreclosure unless we believe it is in that client’s best interests.

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If you’re having financial issues and know bankruptcy might be your only option..


I just want to say “thank you” to you and Mr. Feinberg. I am so grateful to you both. I’m going to take some time and really pray about what to do next. I really need someone who is completely knowledgeable of this process and really wants to help and not just take advantage of someone who is vulnerable. I kinda feel like that is what has happened to me. So I thank God for you both.


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