I have a client that is employed by the IRS. According to the employment contract, if this person defaults on a loan, the employment can be immediately terminated.
Would a short sale be considered a default if the person never missed a payment? (assuming we could get that type of SS completed)
Has anyone dealt directly with this situation?
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this situation is not uncommon...technically, if the employees does a short sale - even if current, there is still grounds for termination. It may be an option to have the employees speak with an HR attorney in the IRS before doing this. I have worked with a number of government employees and contractors in this situation and all have retained their job...but it is an issue
I would not advise this person at all except for telling them to speak to their supervisor about the situation.
If I were the seller, I might even have an employment attorney review my agreement with the IRS and or HR before that discussion just so I had a clear view of my obligations so I can have this discussion from an educated point of view...just a thought.