Hi Everyone,
Here’s the follow up from class. There was a request for the direct link to the IRS website explaining taxation issues surrounding debt forgiveness on a short sale. Here’s the link.
There was a question regarding eviction following foreclosure: Is it 20 days or 90 days? Here is a link to the Bar Assoc website that discusses the 90 day rule regarding evicting tenants. There was a question as to whether or not a new law has been passed to allow the OWNER of a residential home to stay in the home 90 days after foreclosure. This was an excellent question and I found the answer. There was a new law signed by the Governor this past legislative session called SB 5810. Here is the link to the legislative page for the bill. Click on the “final bill report” for a quick summary. It looks like the law was changed to add an additional 30 days to the foreclosure process in a residential, owner occupied foreclosure. This adds a step. The lender MUST make an attempt to contact the homeowner and then must make a declaration that they have taken steps to contact the homeowner. In addition, the law gives TENANTS 60 days to vacate a residential home after foreclosure (previously it was 20 days.) Althought I sympathize with the tenants, it’s important to point out that lenders will think about this as they price new mortgage loans in Washington state.
There are some exceptions. Follow this link and click on “bill as passed by the legislature” to read along with me:
Subsections (1) and (5) of this section do not apply if any of the following occurs:
The borrower has surrendered the property as evidenced by either a letter confirming the surrender or delivery of the keys to the property to the trustee, beneficiary, or authorized agent; or the borrower has filed for bankruptcy, and the bankruptcy stay remains in place, or the borrower has filed for bankruptcy and the bankruptcy court has granted relief from the bankruptcy stay allowing enforcement of the deed of trust.This section applies only to deeds of trust made from January 1, 2003, to December 31, 2007, inclusive, that are recorded against owner-occupied residential real property. This section does not apply to deeds of trust:
(i) Securing a commercial loan;
(ii) securing obligations of a grantor who is not the borrower or a guarantor; or
(iii) securing a purchaser’s obligations under a seller-financed sale.
This law will go into effect July 26, 2009. Remember, it’s only TENANTS that get the additional 60 days to vacate. Owner occupied homeowners must still vacate 20 days after the trustee sale.
A student asked for the names of the three investor groups that were interviewed at the 2009 Auction. Here you go:
Vestus
Here’s the youtube interview with Vestus
Real Estate Investment Firm
My youtube interview with Matt
Foreclosure Solutions NW
My youtube interview with Rob
Thanks for a fun class!