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If you are faced with foreclosure, you can work to save your home-or at least limit the financial damage caused by foreclosure-if you understand your options and take the appropriate steps.
This case raises an issue of first impression,[23] namely, whether California Civil Procedure Code Section 580b applies to bar Defendants, which are mortgage lenders, from collecting a deficiency where Plaintiffs sold their home after defaulting on their mortgage[24] and with the consent of Defendants in a transaction commonly referred to as a "short sale."...........................
Read more ›(3) The principle behind the section 580b protections is to place the risk of inadequate security on the purchase money trust deed beneficiary, thereby forcing the vendor to rely solely on the fair market value of the land for recovery of the sales price and, hopefully discouraging get rich quick land promotions. Section 580b was thus enacted to serve as a stabilizing factor 865*865 in land sales......................................
Read more ›As a general rule, when a taxpayer owes a debt and there is cancellation or forgiveness of the debt, the cancelled amount may be taxable income. The Mortgage Debt Relief Act provides an exception where taxpayers can exclude income from the discharge of debt on a principal residence in certain circumstances. Debt reduced through mortgage restructuring, as well as mortgage debt cancelled during a foreclosure, qualifies for relief. The Act applies to debt forgiven in calendar years 2007 through 2013. Up to $2 million of forgiven debt is eligible for exclusion. Members of Congress are currently trying to extend the Act beyond December 31, 2013.........................
Read more ›Under the federal tax code, when a lender forgives part or all of a mortgage, the borrower must count that forgiveness as taxable income. Congress wisely recognized that this tax rule would discourage the forgiveness of debt as a tool to reduce foreclosures and add insult to injury for borrowers already struggling to pay their bills, many of whom had just lost their home. So in 2007, it passed the Mortgage Debt Forgiveness Act (the Act), which excludes this forgiveness from taxable income..................
Read more ›During the recent U.S. real estate boom, some lending institutions abandoned all caution. Lending policies for subprime mortgages became extremely lax. Dubious loans—such as the so-called “Ninja” (no income, no job or assets) loans—became increasingly commonplace...........................
Read more ›While the news is full of the real estate market crisis and of more and more people losing their homes to foreclosure, few realize the tax consequences of such a process. A foreclosure brings about a property title transfer and subsequent tax assessment. Most property owners do not realize that by losing their home to foreclosure, a capital gain tax assessment can be triggered off........
Read more ›Redemption is a period after your home has already been sold at a foreclosure sale when you can still reclaim your home. You will need to pay the outstanding mortgage balance and all costs incurred during the foreclosure process.................
Read more ›Just visit the Virtual Counselor Network website, and we’ll connect you to a live counselor.
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