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Collections Law/forelosure vs. short sale
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Question
Will foreclosing a home hurts more than a short sale. Will the lender with the same 1st & 2nd goes after me for the deficiency amount, although they've collected the 1st and hopefully agrees to write off the 2nd? Will IRS tax me for the deficiency? help?
Yes a foreclosure is worse than a short sale. The lender could come after you for a deficiency but there is a chance they will not. If they forgive the debt and send you a 1099 although the IRS CAN tax you on the deficiency you can usually get out from under it but you will probably have to have your taxes done by a CPA. Don't worry too much about this. See what they do first. Don't let fear of what they could do force you into bankruptcy. Wait and see what they do then take appropriate action.
"Fear not..."
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Answers by Expert:
Michael Brotherton
Expertise
Consumer/Debtor Rights Advocate. Mike Brotherton is a negotiator with over 30 years experience in consumer lending and collections. Mike has 30 years in the credit and collections industry as a former loan officer, debt collector and manager of two finance companies over several years. Mike is well versed in Loss Mitigation practices and the legal collection process. He has helped literally thousands of people over many years overcome serious financial problems such as foreclosure, creditor lawsuits and abuse by debt collectors. For more information about resolving your "financial emergency" visit www.financialemergency.com. FinancialEmergency.com is a consumer web site which actively promotes Fair Debt Collection Practices and other consumer protection laws. We teach DEBTOR RIGHTS and enforcement of those rights. The more informed you are of your rights and the credit collections practices of creditors the more peace you can have dealing with your FINANCIAL EMERGENCY. Most financial problems are fairly common and as such have some very common solutions. The key is understanding your rights in the collection process and how to enforce them if need be. Primary business- Debtor Rights Advocacy and Debt Mitigation relating to foreclosure, creditor lawsuits, and other serious financial problems. www.financialemergency.com (copy and paste in browser).
Experience
Over 40 years combined experience negotiating disputes and resolving financial issues related to consumer debt, corporate issues and mortgage modifications.
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