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Deficient Judgement Liable?

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mkitarog Joined: 30 Mar 2010 Posts: 1 1.00 Dollars($)	Posted: Tue Mar 30, 2010 11:10 am    Post subject: Deficient Judgement Liable? Like 0 Dislike 0 Mortgage is currently on loan modification. But I'm currently behind and thinking of forclosing it. Alredy filed and discharged last year on Chapter 7. Am I liable on deficiency judgement if I foreclose? What about taxes. Do I have to pay any?
adonis Joined: 22 Oct 2005 Posts: 10542 Location: ALASKA 1086.66 Dollars($)	Posted: Tue Mar 30, 2010 11:13 pm    Post subject: Like 0 Dislike 0 Welcome mkitarog, If you haven't reaffirmed the loan, then you won't be liable for paying off the deficient balance. The forgiven amount will be considered taxable by the IRS and you may have to pay taxes. However, if you had reaffirmed the loan, then you would be responsible for paying off the deficient balance resulting from the foreclosure sale. _________________ Procrastination is the enemy of your financial success
Bragg Guest	Posted: Wed Mar 31, 2010 10:05 am    Post subject: Deficient Judgement Like 0 Dislike 0 Thanks Adonis, Mine is similar to MKITAROG. I didn't reaffirm. However, modification came after the discharge of BK 7. and I already got the cancellation of debt. Now if I foreclose the house, am I subject to any taxes, or any deficiency judgement?
smithsussane Joined: 18 Sep 2008 Posts: 10408 Location: Alaska 981.02 Dollars($)	Posted: Wed Mar 31, 2010 10:47 pm    Post subject: Like 0 Dislike 0 Hi Bragg! Welcome to forums! If you did not reaffirm the loan, then you are not personally liable for the mortgage dues any more. If you let the lender foreclose the property, then he won't be able to come after you for the deficient balance. However, the forgiven debt may be considered as your income and you may have to pay taxes for it. Feel free to ask if you've further queries. Sussane

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