Posted on: 12th Jul, 2010 05:00 am
our mtg co has offered us a deed in lieu and we are not sure if we should accept. are there tax consequences if we do? also does this get rid of our responisbility of the mtg 100%?
hi guest,
if you're unable to pay off the mortgage and want to get rid of the property, then you can accept the deed in lieu of foreclosure as given to you by the lender. in this case, you won't be liable for the deficient balance resulting from the sale of the property. the forgiven amount will be considered as a taxable amount by the irs but due to the mortgage debt relief act, you don't have to pay the taxes.
thanks,
jerry
if you're unable to pay off the mortgage and want to get rid of the property, then you can accept the deed in lieu of foreclosure as given to you by the lender. in this case, you won't be liable for the deficient balance resulting from the sale of the property. the forgiven amount will be considered as a taxable amount by the irs but due to the mortgage debt relief act, you don't have to pay the taxes.
thanks,
jerry