Posted on: 05th Mar, 2008 01:50 pm
at this point, what do you think is our best option?? Foreclosure, Deed in Lieu, or Short Sale? We have had our house on the market since July 2006 with no luck in selling it, and we put it on the market because we knew we'd be having a baby in Jan. 2007 and unable to afford the house. We are really fearful of getting a 1099-c if we do a DIL or short sale.
Plus we have two mortgages.
At this point.. we're feeling that a Foreclosure would be our best option.. we don't have to worry about a 1099-c. We get out from under the house. It kills our credit.. but at this point.. that is an acceptable negative. We've been under a lot of finacial stress.. as you can imagine.
What is your opinion???? Are we doing the right thing???
By the way, we are in California.. and we have 2 mortgages on the house. A
Plus we have two mortgages.
At this point.. we're feeling that a Foreclosure would be our best option.. we don't have to worry about a 1099-c. We get out from under the house. It kills our credit.. but at this point.. that is an acceptable negative. We've been under a lot of finacial stress.. as you can imagine.
What is your opinion???? Are we doing the right thing???
By the way, we are in California.. and we have 2 mortgages on the house. A
Hi,
Welcome to the forum.
Foreclosure is not an option. It is the worst that you can actually imagine. There is nothing good in foreclosure. If you cannot even sell the house then you should have a talk with your lender and request him for DIL.
You may have to pay tax to IRS for the cancellation of due debt but in foreclosure too you will have to pay the total amount of due debt and I think it will not be less than the IRS tax, isn't it?
Feel free to ask if you have any further questions.
Best of luck,
Larry
Welcome to the forum.
Foreclosure is not an option. It is the worst that you can actually imagine. There is nothing good in foreclosure. If you cannot even sell the house then you should have a talk with your lender and request him for DIL.
You may have to pay tax to IRS for the cancellation of due debt but in foreclosure too you will have to pay the total amount of due debt and I think it will not be less than the IRS tax, isn't it?
Feel free to ask if you have any further questions.
Best of luck,
Larry
Hi,
How much is your home selling at? I mean if it's a short sale, how much can be the deficiency amount if your lender at all files for it?
Since you are in California, you will have to pay tax if the deficiency is canceled by the lender. For other states, the borrowers may not have to be as per the rules of the mortgage debt forgiveness act.
Did you ask the lender about deed-in-lieu? Most states don't allow lenders to ask for the deficiency in such a case. Know more on how deed-in-lieu works and then if you have further queries, pls feel free to ask or pm me.
Hope this helps...
God bless you.
Samantha
How much is your home selling at? I mean if it's a short sale, how much can be the deficiency amount if your lender at all files for it?
Since you are in California, you will have to pay tax if the deficiency is canceled by the lender. For other states, the borrowers may not have to be as per the rules of the mortgage debt forgiveness act.
Did you ask the lender about deed-in-lieu? Most states don't allow lenders to ask for the deficiency in such a case. Know more on how deed-in-lieu works and then if you have further queries, pls feel free to ask or pm me.
Hope this helps...
God bless you.
Samantha
Check your state laws as to how foreclosure and or DIL will affect you. In alot of cases you will not be 1099 c so long as its a public auction.
