Posted on: 30th Mar, 2010 11:10 am
Mortgage is currently on loan modification. But I'm currently behind and thinking of forclosing it. Alredy filed and discharged last year on Chapter 7. Am I liable on deficiency judgement if I foreclose? What about taxes. Do I have to pay any?
Welcome mkitarog,
If you haven't reaffirmed the loan, then you won't be liable for paying off the deficient balance. The forgiven amount will be considered taxable by the IRS and you may have to pay taxes. However, if you had reaffirmed the loan, then you would be responsible for paying off the deficient balance resulting from the foreclosure sale.
If you haven't reaffirmed the loan, then you won't be liable for paying off the deficient balance. The forgiven amount will be considered taxable by the IRS and you may have to pay taxes. However, if you had reaffirmed the loan, then you would be responsible for paying off the deficient balance resulting from the foreclosure sale.
Thanks Adonis,
Mine is similar to MKITAROG.
I didn't reaffirm. However, modification came after the discharge of BK 7. and I already got the cancellation of debt. Now if I foreclose the house, am I subject to any taxes, or any deficiency judgement?
Mine is similar to MKITAROG.
I didn't reaffirm. However, modification came after the discharge of BK 7. and I already got the cancellation of debt. Now if I foreclose the house, am I subject to any taxes, or any deficiency judgement?
Hi Bragg!
Welcome to forums!
If you did not reaffirm the loan, then you are not personally liable for the mortgage dues any more. If you let the lender foreclose the property, then he won't be able to come after you for the deficient balance. However, the forgiven debt may be considered as your income and you may have to pay taxes for it.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
If you did not reaffirm the loan, then you are not personally liable for the mortgage dues any more. If you let the lender foreclose the property, then he won't be able to come after you for the deficient balance. However, the forgiven debt may be considered as your income and you may have to pay taxes for it.
Feel free to ask if you've further queries.
Sussane