I Got a Secret!!
Remember way back in 2007, Congress passed the Mortgage Debt Relief Act.
The ACT allowed taxpayers to exclude from income, debt that is forgiven or canceled by their lenders.
This arises when the lender agrees to a short sale or foreclosure, when the amount is less than what is owed.
The amount or "difference" is forgiven.
This is only on personal residence not to vacation or investment properties.
There is also limits to the amount.
Ok, so now this ACT is ending December 31, 2012.
But evreyone I talk to seems like that is far away and there is still time.
I call that the "Alice in Wonderland" Syndrom.
The issue is that the Short Sale and foreclosure process can take over five months to complete. Add marketing to that and now you could be looking at Seven Months.
There is no sense of Urgency from Congress to extend the Tax Relief beyond 2012.
Of course they are not worried because they are far far away from the real world.
The bottom line is if one is facing the possibility of a short sale, they need to move forward. Contact a specialist, talk it over and start planning.
Understand the process and you are ahead of the game.
Alot is at stake, your finances,your credit, and your peace of mind.
Or
Just wait for Congress.
John Hacker
jhackerleads@cox.net
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