Posted on: 26th Aug, 2008 04:42 pm
I owe $475000 on a house that just "appraised" for $280,000. I feel behind in my payments due to a medical emergency/death in the family and was unable to catch up. I am arranging with my banks to do a deed in lieu - which seems like the best solution.
However, how can I control what is reported to the credit bureaus - or can I? I understand laws have changed regarding the 1099 I can expect to receive = I believe for the difference between the present market value and the amount owed.
I want to buy again fast as I do have good income and no other issues with my credit.
Any comments or helpful hints!!!
However, how can I control what is reported to the credit bureaus - or can I? I understand laws have changed regarding the 1099 I can expect to receive = I believe for the difference between the present market value and the amount owed.
I want to buy again fast as I do have good income and no other issues with my credit.
Any comments or helpful hints!!!
Hi adatla,
Welcome to forums.
How much do you owe currently and how's the home sale market in your area?
You'll receive Form 1099A when you go for a deed in lieu wherein the lender cannot collect the deficiency (difference between what you owe and the sale price) as per the laws in most states. But the Form 1099A titled "Acquisition or Abandonment of Secured Property" implies that you no longer have a personal liability for a certain amount of debt (deficiency) on your home. As such you may have to pay income tax. So, the lender informs the IRS of your probable income tax liability through Form 1099A.
A deed in lieu will affect your credit no doubt. So, if possible, give yourself some time before you can actually rebuild your credit and then buy a home again.
Thanks
Welcome to forums.
How much do you owe currently and how's the home sale market in your area?
You'll receive Form 1099A when you go for a deed in lieu wherein the lender cannot collect the deficiency (difference between what you owe and the sale price) as per the laws in most states. But the Form 1099A titled "Acquisition or Abandonment of Secured Property" implies that you no longer have a personal liability for a certain amount of debt (deficiency) on your home. As such you may have to pay income tax. So, the lender informs the IRS of your probable income tax liability through Form 1099A.
A deed in lieu will affect your credit no doubt. So, if possible, give yourself some time before you can actually rebuild your credit and then buy a home again.
Thanks
One year ago next month my home appraised for $572000. Last week, it appraised for $280,000. Incredible, huh. The way I'm figuring it is that those of us folks that are going through the foreclosures and deed in lieu's become buyers of tomorrow - someone is going to want to lend all of us money. I hope it doesnt take too long to buy again, I want to take advantage of these prices too!
Hi Adatla,
Welcome back.
As the housing market nationwide is still on a decline, home prices are quote low in certain areas. So, yes, anyone would like to take this opportunity and purchase at a lower price. But if one isn't buying with plain cash and needs a mortgage, it's better to wait and fix his credit first.
Thanks
Welcome back.
As the housing market nationwide is still on a decline, home prices are quote low in certain areas. So, yes, anyone would like to take this opportunity and purchase at a lower price. But if one isn't buying with plain cash and needs a mortgage, it's better to wait and fix his credit first.
Thanks