Mortgage Forgiveness Debt Relief Act Extended

Reblogger Gina Chirico
Real Estate Agent with Lattimer Realty

J. Philip Faranda shares some great news in his post below on the extension of the mortgage foregiveness debt relief act!  The “American Taxpayer Relief Act of 2012’’ passed on a bipartisan 89-9 vote in the middle of the night thereby extending the 2007 Mortgage Foregiveness Debt Relief Act which was due to expire.  

short sale and the mortgage foregiveness debt relief actIn short, the bill extends mortgage cancellation relief for home owners and/or sellers who have a portion of their mortgage debt forgiven by their lender. Without the extension, any debt forgiven, typically due to a short sale or foreclosure sale would be taxable.  Thus creating an additional financial burden for underwater househoulds.  

Now we wait to see if the House of Representatives is on board.  Many are confident that they are.

If you are facing foreclosure, help is available for New Jersey homeowners facing foreclosure

Original content by J. Philip Faranda License # 49FA1074963

You can all exhale. The Fiscal Cliff deal passed in the wee hours of last night extended the 2007 Mortgage Forgiveness Debt Relief Act which was due to expire at midnight. According to NAR, the American Taxpayer Relief Act of 2012 passed the Senate 89-9. 

There was an awful lot of concern among real estate licensees and borrowers either in or considering a short sale that the tax ramifications of a short sale would change with the expiration of the 2007 law. The extension saw to it that anyone who has purchase mortgage debt forgiven in, for example, a short sale would not have the forgiven debt treated as taxable income. 

There is always small print as to what qualifies, so all are encouraged to consult with their CPA, attorney or financial professional for specific advice, but the current law will continue unchanged, and that is good news. 

This had been a big distraction and concern for the bulk of 2012. I am not happy about how long it took lawmakers to get their act together on this, but that is the climate we are in. The result is a happy one.  

Special thanks to Fred Glick for being on top of this and keeping his colleagues in the know. 

Mortgage Forgiveness Debt Relief Act Extended

______________________________________________________________________________

Subscribe to J. Philip's Real Estate Blog by Email

Active Rain members-Feed your mind.  

In 2012, I Will Sell a Home for US Veteran Facing Hardship Pro Bono

  • We Are Westchester County & Metro New York Real Estate. Reach Phil at (914) 723-8900.
  • J. Philip Faranda, Broker-owner, J. Philip Real Estate, LLC. Vice President, Hudson Gateway Multiple Listing Service. 
  • I am one of New York's premier short sale REALTORS, serving Westchester, the Hudson Valley & Metropolitan New York.
  • Free MLS Search! Register for a Free Listingbook account and search the MLS like an agent. 
  • I am hiring agents. We offer outstanding support, marketing resources, and pasta. 
All content/images, unless noted, are the property of J. Philip Faranda & may not be used without permission
close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Topic:
Real Estate Industry
Groups:
Almost Anything Goes
"Whacked"!!!
Bartender, Make it a Double
Tags:
short sale help
foreclosure options

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Rainmaker
1,317,651
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

I think we have to wait to celebrate.  This bill has to get throught the House... Anything can happen!

Jan 01, 2013 10:59 AM #1
Rainmaker
375,022
Gina Chirico
Lattimer Realty - Fairfield, NJ
Real Estate Agent - Essex County, New Jersey

Joan, you are right.  I sure hope they are on board with this.  What does kicking them when they are down accomplish?  It'll just set short sale sellers farther and farther back especially ones who truly need the forgiveness.   

Jan 01, 2013 11:11 AM #2
Rainer
464,085
April Swenson
Coldwell Banker Ocean Shores Brokers - Ocean Shores, WA
CRS and Managing Broker - Ocean Shores Real Estate

Good news post.  Thank you for letting us all know.  I am sure this will pass the house.

Jan 01, 2013 11:20 AM #3
Rainmaker
182,188
Sherry Chastain
Hendersonville, Nashville, Old Hickory, Lebanon Tennessee - Hendersonville, TN
Realtor, Selling Homes, Lake Properties,Luxury Homes,Short Sales

Whew nothing like waiting till the last second. I told my clients it would surely be addressed. I have more faith now.

Jan 01, 2013 12:23 PM #4
Rainmaker
1,005,518
Karen Anne Stone
New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX
Fort Worth Real Estate

Gina, news junkie that I am, I watched the House vote on the final "Fiscal Cliff" bill, and it PASSED tonight about 10:30PM Eastern time.  And it passed with both Democrats and Republicans voting for it.  The final vote was 257 to 167.  I believe that 82 Republicans joined 175 Democrats in getting this bill approved.

If only the attitude of Negotiation and Compromise that the House and Senate have worked on in years passed can carry over to all of 2013, and we can get something done.  I hope so, but honestly, I doubt it.  That... would make too much sense.

Jan 01, 2013 02:07 PM #5
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?

Rainmaker
375,022

Gina Chirico

Real Estate Agent - Essex County, New Jersey
Ask me a question
*
*
*
*
Spam prevention