Archive for Mortgages
No More Tax On Forgiveness Of Debt In California
Posted by: | CommentsNO MORE STATE TAX ON FORGIVEN DEBT
Distressed homeowners no longer have to pay California state income tax on debt forgiven in a short sale, foreclosure, or loan modification. Enacted into law yesterday, Senate Bill 401 generally aligns California’s tax treatment of mortgage debt relief income with federal law. For debt forgiven on a loan secured by a “qualified principal residence,” borrowers will now be exempt from both federal and state income tax consequences. The existing federal exemption is for indebtedness up to $2 million, whereas the new California exemption is for indebtedness up to $800,000 and forgiven debt up to $500,000.
“Qualified principal residence” indebtedness is defined as debt incurred in acquiring, constructing, or substantially improving a principal residence. It includes both first and second trust deeds. It also includes a refinance loan to the extent the funds were used to payoff a previous loan that would have qualified.
The tax breaks apply to debts discharged from 2009 through 2012. Californians who have already filed their 2009 tax returns may claim the exemption by filing a Form 540X amendment.
Taxpayers who do not qualify for the above exemptions (e.g., second home or rental property) may nevertheless be exempt under other provisions. Most notably, taxpayers who are bankrupt are exempt from debt relief income tax. Also, taxpayers who are insolvent are exempt from debt relief income tax to the extent their current liabilities exceed current assets.
For more information about mortgage forgiveness tax consequences, go to California Franchise Tax Board’s Mortgage Forgiveness Debt Relief Extended webpage and the Internal Revenue Service’s Mortgage Forgiveness Debt Relief Act and Debt Cancellation webpage. The full text of Senate Bill 401 is available at www.leginfo.ca.gov.
Brought to you by the California Association Of Realtors
Leon C. Williams Certified Foreclosure Specialist Pre-Foreclosure Coach leon@williamslandmark.com Leonsblog Sacramento Short Sale Guru Sacramento Pre-foreclosure Workshop Williams Landmark Real Estate
Sacramento Pre-foreclosure Workshop Addresses Problem With Mortgage Servicers
Posted by: | CommentsSacramento Pre-foreclosure Workshop April 24, 2010, Gives Homeowners Education, Options, Timelines, and Strategies to Fight Back
As our country hemorrhages from a foreclosure crisis of historic proportions, home values plummeting, layoffs the rule instead of the exception and millions of families having lost their homes and millions more just a couple missed payments away from being homeless, one commonsense solution to the foreclosure crisis stands out. That solution is simple, Read More→
Sacramento Real Estate Attorney’s
Posted by: | CommentsSacramento Real Estate Attorney’s
Useful to stop Sacramento Foreclosures Read More→
Sacramento Bankruptcy Attorney’s
Posted by: | CommentsSacramento Bankruptcy Lawyers
Good to have if last resort in a Sacramento foreclosure situation Read More→
Foreclosure Stop
Posted by: | CommentsMost people are under the impression that once a foreclosure starts it can not be stopped. That can not be further from the truth. I call this “The Foreclosure Stop Approach”.
There are several techniques to stopping a foreclosure. Here are seven things you can do to execute the “Foreclosure Stop” approach.
First, there is negotiating with your lender. The typical response from a homeowner when faced with not being able to pay the mortgage is to not anwer the telephone. This technique however is never a good strategy. Lenders rarely cooperate with borrowers who contact them on the eve of a foreclosure sale. Respond to all calls, letters and emails. It is also important to make sure you are dealing with your “current” lender nad negotiate with a spirit of cooperation while talking the lenders language. Bone up on various negotiation strategies.
Second, you can refinance out of your current mortgage. You may not be in the position to affect a typical refinance as your home may be too “Upside Down”. Other questions you may want to ask if you are considering a refinance is; Should you use a Mortgage Broker?; Will you qualify for refinancing?; What kind of loan you should get?; Will the closing costs make it worth while? Make sure that you work with a Certified Mortgage planner to discuss your options.
Third, if you are in the military you might be able to use the “Soldiers’ Civil Act of 1940″ and the Service Members Civil Relief Act of 2003 (collectively called the SSCRA). The SSCRA is the protection of active military personnel and their families from foreclosure. The SSCRA can be used to stop a foreclosure, invalidate a foreclosure sale, or reduce your loan interest rate. You are going to want to find and attorney that thoroughly understands these Acts.
Fourth, you can use the courts to stop a nonjudicial foreclosure. The biggest question here is do you have grounds to go to court. These generally fall into two main categories. 1. Disputes over your state’s foreclosure procedures. 2. Disputes with your lender over the terms of your promissary note and/or deed of trust.
Fifth, you can file Bankruptcy.
Sixth, you can sell your property quickly to stop the foreclosure. If you owe more on your house than it is worth you will have to do what is known as a shortsale.
Seventh, You can give your lender a Deed In Lieu Of Foreclosure. This is essentially just signing the property back to a lender. There are many reasons why a lender would or would not do this, however this article is much to short to go into.
The bottom line is you do have several options to perform a “Foreclosure Stop“. The sooner you act the more options you will have. Learn more by attending the Sacramento Pre-Foreclosure Workshop.
Leon C. williams Financial Strategist Certified Foreclosure Specialist Certified Mortgage Planning Specialist Pre-foreclosure Coach leon@lucafinancial.com Learn more by attending the Sacramento Preforeclosure Workshop.
