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Deed in lieu of foreclosure

Posted on: 10th Nov, 2010 06:04 pm
I currently owe 190K on my home and it is worth about 120K. If I get a dil to I have to pay taxes on the 70k difference?
I am not eligible for a loan modification as I have less than the 31% limit.
Hi jtfoa,

Welcome to mortgage fit,

You are liable for the taxes for the 70 K difference.....

For further information on the tax consequences you may visit below mentioned link.....

http://www.mortgagefit.com/deed-lieu.html#deedinlieutax

Feel free to ask any further query if you have.......

DIPA
Posted on: 10th Nov, 2010 08:03 pm
Hi jtfoa!

Welcome to forums!

The deficient amount will be forgiven in case of a deed in lieu of foreclosure. However, you won't have to pay taxes for the forgiven debt due to the Mortgage Debt Relief Act.

Feel free to ask if you've further queries.

Sussane
Posted on: 10th Nov, 2010 08:19 pm
http://www.irs.gov/individuals/article/0,,id=179414,00.html

go to the above link if you already haven't and read the IRS information on this question.

Professor Loan Mod
"WE ARE A FREE SERVICE!"

[Links deleted as per forum rules. Thanks.]
Posted on: 11th Nov, 2010 01:27 pm
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