Mortgage Forgiveness Debt Relief Act Extended. Happy 2013.

Reblogger
Industry Observer with No Longer Processing Mortgages. MLO #293441 expired

In this post from J Phillip Faranda, from Westchester County, New York, shares the good news that the financial bill passed by both houses last night includes a one year continuance of the Mortgage Forgiveness Debt Relief Act extension.

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

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Steven CookSteven T Cook
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Comments (9)

Fred Griffin Tallahassee Real Estate
Fred Griffin Real Estate - Tallahassee, FL
Licensed Florida Real Estate Broker

Great choice for a Reblog, Steven!   This is definitely good news.

Jan 02, 2013 09:37 AM
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Steven this is a start, now they need to keep the Mortgage Interest Rate Deduction off of the chopping table.

Jan 02, 2013 10:00 AM
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

Fred -- You are right, this is good news with the number of foreclosures that are still in process.

George -- if we could just get Congress, and the President, to realize that cutting tax breaks is not a "revenue enhancement".  Nor is it cutting spending, which is what they really need to be doing.

Jan 03, 2013 03:47 AM
William Feela
WHISPERING PINES REALTY - North Branch, MN
Realtor, Whispering Pines Realty 651-674-5999 No.

I would be this could be the last year of this program. 

Jan 03, 2013 05:23 AM
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

William -- it would be good to have the short sales and foreclosures die off enough that this wouldn't be needed in the future.

Jan 03, 2013 06:41 AM
Joe Petrowsky
Mortgage Consultant, Right Trac Financial Group, Inc. NMLS # 2709 - Manchester, CT
Your Mortgage Consultant for Life

Unfortunately, they didn't extend it long enough. It should have been extended for a longer time period. These problems will be gone over the next 12 months.

Jan 03, 2013 09:08 PM
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

Joe -- you may be right, they may have been too optimistic.  But maybe this will get a few fence sitters to make a decision.

Jan 04, 2013 03:38 AM
Laura Giannotta
Keller Williams Realty - Atlantic Shore - Little Egg Harbor, NJ
Your Realtor Down the Shore!

I held my breath on this one...had a short sale that was to close on the 31st, luckily it closed yesterday and my sellers can take advantage of the extension!

Jan 07, 2013 09:48 PM
Steven Cook
No Longer Processing Mortgages. - Tacoma, WA

Laura -- glad to hear that they were able to take advantage of this extension, and the government isn't taking advantage of them in their situation!

Jan 08, 2013 07:50 AM

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