Posted on: 01st Jun, 2009 04:04 pm
my property was foreclosed on in june 2008. i filed for chapter 13 bankruptcy in july 2008. i received a 1099a in feb 2009 and right away noticed that the fmv was higher than the amount owed. i owed $473,000 and the fmv is $532,000. i am liable for the debt., now, i had this property on the market for since november 2007, 7 months prior to foreclosure and the listing price was $269,000. my real estate agent said that amount was pushing it and that i would probably not get many bidders, and she was right. we lowered the amount twice and still nothing. one offer for a short sale price of $180,000, which didn't even get looked at by the bank. once my taxes were done(by a cpa) and we owed, i called my bankruptcy lawyer just to ask some questions and mentioned the 1099a. he said the fmv should be the amount that the house was purchased for at foreclosure, which was $195,000 (i obtained a copy of the deed). the property was bought back by the bank. so, if the bank purchased the property for $195,000, how can they possibly say the fmv was $532,000 on the 1099a. that's a sustantial difference!!! will the lender have to correct the 1099a and if so, how will it change my situation?? this was investment property.
Hi shellpea,
If the FMV of the property was more than what you owed, then in my opinion, you would have got buyers for the property and you could have sold the property easily. But you have mentioned that your were unable to sell the property and you did not get any bidders. Thus, your bank purchased the property for $195,000.
In my opinion, the FMV of $532,000 is quite high. There is something fishy in it and the lender must not have quoted the right value. I would suggest you to contact your lender and ask him to explain the figures in detail. He will be the best person to let you know why there is a difference between the figures.
Take care.
If the FMV of the property was more than what you owed, then in my opinion, you would have got buyers for the property and you could have sold the property easily. But you have mentioned that your were unable to sell the property and you did not get any bidders. Thus, your bank purchased the property for $195,000.
In my opinion, the FMV of $532,000 is quite high. There is something fishy in it and the lender must not have quoted the right value. I would suggest you to contact your lender and ask him to explain the figures in detail. He will be the best person to let you know why there is a difference between the figures.
Take care.
Thanks Sara! I'm thinking the same as you. My tax guy is looking into it, but as you know this issue is just becoming more prominent now with all the foreclosures. So information on how to handle it is not really out there yet. He is trying to get as much info as he can as ammo for me to have when I call the lender. If the lender agrees to change the 1099A, will that have a positive effect on my tax return?
Hi shellpea
In my opinion, if the lender changes the 1099A, then it will definitely have a positive effect on your tax returns.
Thanks.
In my opinion, if the lender changes the 1099A, then it will definitely have a positive effect on your tax returns.
Thanks.