The Karlin Law Firm LLP

Providing quality legal services to statewide and national clients in ADA defense, Personal Injury, business and real estate for more than 35 years

Email Us
Practice Areas

Avoiding foreclosure with a short sale in California

When homeowners in California run into financial difficulties and owe far more on mortgages than their properties are worth, their lenders may sometimes agree to accept what are known as short sales. Short sales prevent lenders from taking even larger losses and allow them to avoid paying the costs involved in pursuing foreclosure. However, these complex real estate transactions can be time-consuming and difficult to close.

Since lenders lose money when they accept a short sale, they only consider them when certain requirements have been met. Borrowers must be able to show that they have been coping with financial difficulties for some time and are unable to refinance their mortgages to lower their payments. Some lenders may demand that the property involved be placed on the open market for a specified time in order to better evaluate the short sale offer.

Lenders are cautious because California is what is known as a nonrecourse state. This means that lenders in the Golden State are not able to recover the losses they suffer in short sales by filing lawsuits against borrowers. However, this law does not always apply to the holders of second mortgages or debt consolidation loans. Short sales became an even more attractive option for struggling California homeowners in 2010 when lawmakers voted to protect them from tax liability on the relief they receive from lenders providing the property involved was used as a primary residence.

Short sales can be particularly difficult to complete when several lenders are involved. Attorneys with experience in this area may act proactively in these situations and pursue approvals from all relevant parties as quickly as possible to prevent deals being held up by unnecessary delays. They could also remind reluctant lenders of the risks and costs involved in pursuing foreclosure.

No Comments

Leave a comment
Comment Information

Contact Us Today

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

L. Scott Karlin

L. Scott Karlin

Attorney Profile
David E. Karlin

David E. Karlin

David E. Karlin is a California attorney with a primary focus on business and real estate, including law and legal issues...

Attorney Profile
Michael J. Karlin

Michael J. Karlin

Michael J. Karlin is a Southern California based attorney whose practice primarily focuses on Entertainment Law. Michael began...

Attorney Profile

Recent Articles

ADA Fraud Reported

A recent article on the news concerns a man in Riverside County who allegedly has attempted to obtain money from property owners and businesses based on alleged violations of the Americans with Disablities Act (ADA). Read More

Tustin Office
13522 Newport Avenue, Suite 201
Tustin, CA 92780

Phone: 714-881-0054
Tustin Law Office Map

Newport Beach Office
2901 West Coast Highway, Suite 200
Newport Beach, CA 92663

Phone: 949-427-9328
Newport Beach Law Office Map

Carlsbad Office
2173 Salk Avenue
Suite 250
Carlsbad, CA 92008

Phone: 760-407-2409
Map & Directions

Riverside Office
6809 Indiana Avenue
Suite 100
Riverside, CA 92506

Phone: 951-643-8769
Map & Directions

Los Angeles Office
1100 S. Hope Street
Suite 103
Los Angeles, CA 90015

Phone: 213-519-5633
Map & Directions

Fresno Office
1444 Fulton Street
Fresno, CA 93721

Phone: 951-373-4384
Map & Directions