BY CATHY JETT

The consequences of short sales were on the minds of many readers who submitted questions during Tuesday's Money Talk$ web chat on fredericksburg.com.

Below is a selection of their questions and answers from our guest expert, Sabrina Anderson, the managing broker of Coldwell Banker Carriage House Realty in downtown Fredericksburg.

Anderson also is a director of the Fredericksburg Area Association of Realtors; part of the Virginia Leadership Academy; a licensed instructor with Moseley Real Estate Schools; and has an extensive background working with new-home builders.

A transcript of the entire Q & A will be archived on our website.

;">How do you get your bank to agree to a short sale? Does it affect your credit?

You should first have a CMA done by a Realtor. Not all banks agree to a short sale. It will depend on your unique circumstances.

Take the following steps:

Call the lender.

Hire an experienced Realtor.

Submit a letter of authorization to the bank to allow them to speak with them regarding your mortgage, etc.

The Realtor will do a market analysis and the bank will consider this with the additional documentation: your hardship letter, tax returns for the last two years, a list of assets and debts, most recent bank statements.

A preliminary HUD will also need to be done by a settlement company showing the bank's net.

;">If a bank agrees to a short sale, am I liable for taxes on the difference between the mortgage and the short sale price?

It will depend. The Mortgage Debt Relief Act was from 2007 through 2012 and expires this December 31 unless granted an extension. If it is a primary residence and the bank accepts the short sale terms and the payment as full, the bank will submit a 1099.

The Act allows the mortgage debt to be forgiven without recourse if certain conditions apply. I'd recommend you see a tax attorney regarding your exact situation.

;">Can a bank seize your assets (savings account, checking account funds, etc.) after they agree to a short sale in an effort to recoup some of what they are losing on your home?

They will negotiate with you if you have assets, realizing you have liquid cash available. They cannot touch a retirement fund such as a 401(k), etc.