Posted on: 25th Dec, 2007 12:57 pm
i own a home in mn , it has about 610k in debt against it , but is only worth 550k , does this difference affect me in tax or owing the difference with a forclosure , also i have a contract for deed on hunting land in wi. will this forclosure be able to come after that land also for the difference i owe on the house?
Hi,
Welcome to Mortgagefit discussion board.
I agree with Larry above that you should try to avoid foreclosure first. Now I would like to know if you have ever made any late payments. In general, if you make two late payments consecutively then the mortgage company will send you notice and go for foreclosure.
So contact with the lender ASAP as Larry has stated above and try to avoid foreclosure as it is considered even worse than BK.
Yes Larry has rightly said that you may have to pay the deficiency judgment but if the lender forgives the debt after Short sale, then you may need not to pay the tax on it as President Bush has recently passed the law. It has been discussed in the community recently. You can check it out-
http://www.mortgagefit.com/tax/debtforgiveness-reliefact.html#39732
Hope it will help you.
Do let me know if you have any other questions.
Thanks
Blue
Welcome to Mortgagefit discussion board.
I agree with Larry above that you should try to avoid foreclosure first. Now I would like to know if you have ever made any late payments. In general, if you make two late payments consecutively then the mortgage company will send you notice and go for foreclosure.
So contact with the lender ASAP as Larry has stated above and try to avoid foreclosure as it is considered even worse than BK.
Yes Larry has rightly said that you may have to pay the deficiency judgment but if the lender forgives the debt after Short sale, then you may need not to pay the tax on it as President Bush has recently passed the law. It has been discussed in the community recently. You can check it out-
http://www.mortgagefit.com/tax/debtforgiveness-reliefact.html#39732
Hope it will help you.
Do let me know if you have any other questions.
Thanks
Blue
Hello Aric,
The foreclosure on your home will not affect your other properties. As your home is the collateral for the mortgage so the lender will not come after your land.
In case of a foreclosure, the lender might seek deficiency judgment to recover the unpaid mortgage balance. Then you shall remain liable to pay that off.
But it will be better to avoid foreclosure if that is possible. Because foreclosure has damaging effects on your credit and it will stay on your report for as long as 7 years.
The foreclosure on your home will not affect your other properties. As your home is the collateral for the mortgage so the lender will not come after your land.
In case of a foreclosure, the lender might seek deficiency judgment to recover the unpaid mortgage balance. Then you shall remain liable to pay that off.
But it will be better to avoid foreclosure if that is possible. Because foreclosure has damaging effects on your credit and it will stay on your report for as long as 7 years.
Well Aric, please don't worry; the difference between your home value and the total loan balance isn't much. So, if at all you aren't able to pay and if you're ready to sell off the home, that will be a short sale only. But how's the market in your area? Are you aware of the home prices in the neighborhood - I hope you are. If not, then you may consult a real estate agent before you go for short sale. If this option works out for you, then the lender will probably file a deficiency judgment to collect the remaining debt.
Even if you are not able to pay the remaining part, you may negotiate with the lender for cancellation of the unpaid debt. And, as per the recent Mortgage Tax Relief Act, taxes won't be imposed on the forgiven debt. So cheer up and talk to the lender. :)
Regards,
Jessica
Even if you are not able to pay the remaining part, you may negotiate with the lender for cancellation of the unpaid debt. And, as per the recent Mortgage Tax Relief Act, taxes won't be imposed on the forgiven debt. So cheer up and talk to the lender. :)
Regards,
Jessica
The fact that you claim you can get derog credit items reomved is a rather mute point when it comes to a foreclosure......you are asked if you have had a foreclosure in the past 7 years......if you do not answer that in the affirmitive on a mortgage application you are committing fraud........
[Promotional part deleted as per forum rules. Thanks.]
[Promotional part deleted as per forum rules. Thanks.]
If the land was included in the appraisal, which it most likely was, then yes they will take the land along with the house. If you want to keep the property, try calling your lender to work something out. Most of them have workout solutions for those in foreclosure. If you want to let it go, then they will take the entire property that was appraised. If you look at your final paperwork, it will list all parcels that are secured by the mortgage.