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Any Expert with regards to Short Sales

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Icon Mini Profile lynnbrown
lynnbrown




Joined: 24 Mar 2009

Posts: 7
Location: Paso Robles, CA
3.79 Dollars($)
Post Posted: Tue Mar 24, 2009 10:41 am    Post subject: Any Expert with regards to Short Sales
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We sold our investmenet property (duplex) for a lot less than what we owed (approx $150K less!!)

Do we have to pay personal income tax on the short fall?
Icon Mini Profile jameshogg
jameshogg




Joined: 20 Dec 2005

Posts: 10148
Location: Nevada
941.94 Dollars($)
Post Posted: Tue Mar 24, 2009 9:14 pm    Post subject:
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Hi info,

As far as I know, you'll not have to pay the taxes for the short fall. But you will have to pay the deficient amount to the lender. If you do not pay the deficient amount, then the lender may charge it off or forgive it. If the lender charges it off, then a 3rd party collection agency will collect the dues from you. But if the lender forgives it, then you'll have to pay taxes.

Thanks
infoss

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Post Posted: Tue Mar 24, 2009 9:20 pm    Post subject: Short Sale
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What if you filed for Bankruptcy - does that protect your from the lender or collector to get the deficiency?
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Icon Mini Profile smithsussane
smith.sussane




Joined: 18 Sep 2008

Posts: 10030
Location: Alaska
919.49 Dollars($)
Post Posted: Wed Mar 25, 2009 9:45 pm    Post subject:
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Hi infoss!

Welcome to forums!

When you file bankruptcy, the court issues an automatic stay. During this automatic stay, the lenders or creditors will not be able to take any actions against you. After the discharge, if you reaffirm the debts, then you would be liable to pay it off. In such a case, if you don't pay off the debts, then the lender may foreclose and seek the deficient amount.

Sussane
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