Debt Relief Act Extended

Real Estate Sales Representative with Wizards of Waz Real Estate

After many months of holding their breath, distressed homeowners can now breath a sigh of relief. The Debt Relief Act of 2007 has been extended through 2013. There are rumors that it will be extended further in the final deal but for now, at least, the news is good.

The Debt Relief Act offers protection against for homeowners who short sale or lose their home to foreclosure. Prior to the bill, homeowners were potentially reponsible for paying taxes on the deficiency (the difference between what they owe on their mortgage and what their home actually sells for). Although many homeowners were able to get around the taxes by filing a form through their CPA,, this bill gave most homeowners a reprieve from these taxes.

Hopefully, this is just the first in many steps the government will take to offer assistance to distressed homeowners.

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