Mortgage Foreclosure

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Statute of Limitations For Credit Card and Mortgage Debts

I have been asked many times over the years about the statute of limitations applicable to mortgages and credit card debt. The statute of limitations is a legal term that determines how loan may a bank due a debtor for missing a mortgage payment of defaulting on payments under a…

Lender’s Release of Personal Guarantee Does Not Impute Taxable Income

I recently wrote a blog post about avoiding imputed income from debt forgiveness following a foreclosure against a business owned property. I suggested that a business that is organized as a C corporation would not pass through imputed income to its individual owners, but I stated I was unsure if…

Dual Tracking Rules Prohibit Foreclosure During Mortgage Modification

During the height of the real estate recession many homeowners told me stories about how they were surprised by aggressive foreclosure by bank attorneys when they thought they were moving toward mortgage relief settlements with the bank’s representatives. That bank practice is known as “dual tracking”; that is, banks engage…

How To Avoid HOA Dues and Other Liability After Surrendering House

A homeowner who  their homes to their mortgage company face costs and liability other than mortgage payments and possible deficiency judgments. In addition to mortgage payments the homeowner is liable for homeowner association dues and assessments that come due after the homeowner stops paying the mortgage but before the mortgage…

Foreclosure And Personal Guarantee : Lender Can Sue For Both Actions Simultaneously

Most commercial mortgage loans made to LLCs or corporations require a separate personal guarantee by the individual principals of the corporate or LLC borrower. If the investment fails economically the lender can and usually does foreclose its mortgage on the property Most people believe that the lender will not sue…

The Performing Non-Performing Loan: The Paradox Destoying Real Estate Wealth

The bank expects the client to pay the loan in full in a real estate market where the client cannot sell the property and cannot refinance the property with another bank because banks today are reluctant to extend new credit. The client wonders why his loan which has always been…

Can A Mortgage Lender Seek Deficiency Judgment After Issuing A Form 1099?

  Many people do not understand the significance of tax form 1099 in the foreclosure context. A 1099 is an IRS reporting form indicating that the lender has written off a mortgage and is declaring a tax loss. The borrower may have to declare the bank’s loss as imputed income.

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Forclosure Tax Effect: Imputed Income From Debt Forgiveness May Be Offset By Investment Losses

Many people facing foreclosure are concerned about income tax liability from the lender’s forgiveness of mortgage debt. If the mortgage lender does not pursue a deficiency judgment and writes-off the loan after foreclosure the lender could send the owner a IRS Form 1099 for imputed income for the amount of…