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Jessica
Community Mentor
Joined: 08 Jun 2004
Posts: 672
Location: OHIO
116.76 Dollars($)
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 Posted: Sat Mar 22, 2008 1:19 am Post subject: RE: tax ramifications of short sale, deed-in-lieu |
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Hi Hohum,
I think the first lender has foreclosed, is that so? Let me ask you – are you interested to keep the house. If yes, then filing chapter 13 makes sense provided you qualify for it. At least you can pay off the dues in the mortgage and then start afresh with the remaining payments on the balance. And, you'll be able to stop foreclosure too for a period of 3-5 years after which if you can continue with the payments, the lender won't even foreclose. He might even offer you a suitable repayment plan or allow you to refinance or sell the property and then pay off the loan. This way, you can prevent your credit from getting the hit.
Since you have just received the foreclosure notice, I suppose you have around 60-90 days to do something to save your home. However do check this out from the notice or ask the lender as to when the date of sale has been fixed.
I suppose filing Chapter13 will be a better option because the first lender isn't willing to do a deed-in-lieu which is better than going for short sale (though short sale would have hurt your credit more) as he won't be able to collect deficiency. But your second lender have said that they might go for wage garnishment. Did you ask them how much they'd take out from your paycheck? This is something to be concerned about.
Regarding the tax implications of short sale or deed-in-lieu, I would say that you may not have to pay tax if the deficiency is forgiven. Please check out the discussions on Tax break on mortgage forgiveness and Tax ramifications of deed-in-lieu .
However, not all mortgage debt would qualify for forgiveness. There are certain criteria involved.
Feel free to ask further questions.
Regards,
Jessica
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Home buying made simple with Community booklet |
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lee
Guest
0.10 Dollars($)
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| Posted: Fri Mar 28, 2008 11:29 am Post subject: Deed-in-lieu, please help |
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I purchased a condo for $490k in july 2007 to remodel & sell. I invested $30k & have been making payments of $3500 each month all coming from the equity line on my 1st house. My equity is now maxed out at $150K The condo has been on the market since sept of 2007 with out any offer made on it. I have dropped the price to $500k so that I only pay off the loan amount of $46500 & closing costs but not my invested amount or payments made but still have not had any offers.
I would like to know what are my options are and how deed in liew effects my credit score as well as other options effect my credit score
Thank you very much'
Lee "LLD57@msn.com"
[Link deactivated as per forum rules. Thanks.] |
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Samantha
Community Mentor
Joined: 16 Sep 2005
Posts: 1484
Location: MASSACHUSETTS
127.29 Dollars($)
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| Posted: Sat Mar 29, 2008 1:28 am Post subject: RE: how deed in lieu affects |
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Hi Lee,
Did you talk to the lender about going for a deed-in-lieu? considering the fact that the market isn't going well, i don't think he will agree, but you can still give the proposal.
There are other options which may help you get through this situation. Please check out some of the foreclosure prevention options .
Also, read through the article on deed-in-lieu to find out how it can affect you.
Hope this helps...
God bless you.
Samantha
_________________
Know how to compare lenders with mortgage booklet |
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anonymous 1
Guest
0.10 Dollars($)
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| Posted: Fri Apr 04, 2008 4:26 pm Post subject: How to Seek Court Protection |
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| Where and how do i seek court protection if i need time,im unemployed,inncalifornia,alameda county,do i need to see an attorney? Please respond immedietely.my trustee sale is end of april |
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Niicss
Joined: 03 Oct 2005
Posts: 1039
154.84 Dollars($)
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| Posted: Sat Apr 05, 2008 4:11 am Post subject: |
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Welcome.
You can look through this site: http://www.alameda.courts.ca.gov/courts/
Hope this would be some help for you.
Let me know if you have any more queries
_________________
Good is the Enemy of Great. |
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raquel
Guest
0.10 Dollars($)
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| Posted: Tue Apr 08, 2008 1:46 pm Post subject: deed in lieu |
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| what if yu have an equity line attached as well as 1st mort..and what if you have other property will they come after that to satisfy loans.. |
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larry
Joined: 27 Jun 2007
Posts: 3321
472.39 Dollars($)
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| Posted: Wed Apr 09, 2008 1:57 am Post subject: |
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Hi raquel,
Welcome to the forum.
If the lender accept the deed in lieu then it is expected that he will not ask you for the deficiency judgment.
Have you taken both the loan form the same lender? If not then is the lender of your second mortgage also accept the deed in lieu?
Best of luck,
Larry |
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cpapkt
Guest
0.10 Dollars($)
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| Posted: Thu Apr 24, 2008 4:22 pm Post subject: Deed in lieu of foreclosure when the eviction notice is near |
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| Currently my brother has not made a mortgage payment since approximately October 2007. It is now April 2008 and he figures the eviction notice is going to come around the first of June. It sounds like deed in lieu of foreclosure is the best way for him to go. He is employed, but between the child support and alimony he can not make the mortgage payments. Unfortunately, the mortgage is more than the house is worth. Is it to late for a deed in lieu or should he try some other avenue? |
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larry
Joined: 27 Jun 2007
Posts: 3321
472.39 Dollars($)
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| Posted: Fri Apr 25, 2008 2:13 am Post subject: |
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Hi cpapkt,
Welcome to the forum.
Surely deed in lieu is an option for you. Talk with the lender ASAP regarding this. Try and avoid foreclosure. If you just sit back then you cannot avoid foreclosure. Ask your brother to inform the lender about his problem and request the lender for DIL. It will help you to avoid deficiency judgment.
Feel free to ask if you have any further questions.
Best of luck,
Larry |
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cpapkt
Guest
0.10 Dollars($)
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| Posted: Sat Apr 26, 2008 5:50 pm Post subject: |
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| I just found out from my brother the bank has already started the foreclosure process. Is it too late to request the deed in lieu of foreclosure since the process according to him has already begun? I guess worse case scenario is he won't be any worse off. |
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larry
Joined: 27 Jun 2007
Posts: 3321
472.39 Dollars($)
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| Posted: Sun Apr 27, 2008 11:30 pm Post subject: |
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Hi cpapkt,
Welcome back.
Now have you told the lender about your problem and checked out the options available for you?
You can request for deed in lieu even after the foreclosure process is started.
Best of luck,
Larry |
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AJ5585
Guest
0.10 Dollars($)
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| Posted: Wed Apr 30, 2008 6:43 am Post subject: WDIL |
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| My mom pasted away and was purchasing a time-share property which I can neither continue to pay or pay off. I was not listed on the loan but was listed on the title of ownership in case something happened to her. The company would like me to sign a WDIL and avoid foreclosure. My question is that they are saying even if I wasn't on the loan my credit would be impacted with the foreclosed property, is this true? |
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Niicss
Joined: 03 Oct 2005
Posts: 1039
154.84 Dollars($)
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| Posted: Thu May 01, 2008 3:27 am Post subject: |
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Hi,
Did the lender suggest you to sign a deed in lieu of foreclosure? I think if you can sell the property and pay off the lender then it will be better as DIL will have negative effect on your credit report. But if you cannot sell the property then you can go for DIL.
"they are saying even if I wasn't on the loan my credit would be impacted with the foreclosed property, is this true?"
Yes it is true. But it will not effect as much as if you were also on the mortgage.
Let me know if you have any further questions.
_________________
Good is the Enemy of Great. |
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DIL-weed
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0.10 Dollars($)
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| Posted: Mon May 05, 2008 1:55 pm Post subject: Foreclosure vs DIL |
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| I have a 1st mortgage and equity line of credit on my home for a total of 967K(630K and 337K). With today's market value of homes, my house only appriased for 1075K even though I have 1175K into it. I have had the house for sale for 9 mos already. I am approaching a position of no longer being able to afford the two combined payments. I have done some reading on Foreclosure and DIL options but all the articles say about the same thing. My credit score is 820+ and I have worked hard to keep my credit score favorable. Im trying to understand if my credit rating will nose dive if I foreclose(likely so) vs DIL and if I will likely be responsible for any other differences in what I owe vs if the bank(DIL Option) doesnt produce enough to cover both the primary and junior lien (equity Line) and if so will the option be to bankrupt to save myself from paying the large sum difference? I have sought an attorney to assist with getting advice and normal results but Im having trouble identifying someone who sepcializes specifically in representing the consumer/private home owner in this situation. I live in NE Atlanta suburbs. Additionally, if I DIL, and when/if the bank were to sell my house, and if the proceeds were more than my 1st mortgage, would the proceeds of the house go to cover my junior lien too? Thanks for any advice and direction! |
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larry
Joined: 27 Jun 2007
Posts: 3321
472.39 Dollars($)
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| Posted: Mon May 05, 2008 11:05 pm Post subject: |
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Hi Guest,
Welcome to the forum.
Certainly deed in lieu is better than foreclosure because you can avoid deficiency judgment but I think it should be your last option to choose.
You have really very good credit score. So do not hamper it by going through foreclosure, DIL or filing BK. If you can please avoid these. These relieves are for the people who can do nothing but have to choose it.
But I believe you can avoid these. First of all talk with the lender ASAP and check out if he can work out any repayment plan for you.
Now do you have ARM? Why don't you refinance and turn it into FRM with lower monthly payments. I think you can go for No-obligation free consultation from the rated mortgage lenders and mortgage professionals of this community to see what should be the best option for you to choose.
Feel free to ask if you have any further questions.
Best of luck,
Larry |
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