Mortgage Debt Relief Act Extended Through 2013 As Part of the “Fiscal Cliff Bill”

Your Dayton bankruptcy attorney is pleased to report that Congress has extended the 2007 Mortgage Debt Relief Act through 2013. The Mortgage Debt Relief Act prevents debt that is forgiven through short sales, loan modifications or foreclosures from being taxable income to the homeowner. Without the extension of the Mortgage Debt Relief Act, homeowners may have decided that short sales (when a home is sold for less than the amount owed on the mortgage) were not in their best interest, because the difference between the amount paid by a buyer on the home, and the amount owed on the mortgage, would be taxable income to the homeowner (as it was prior to the initial passing of the bill in 2007). Similarly, without the extension of the Mortgage Debt Relief Act, principal forgiven by a bank as part of a loan modification may also have reverted back to being taxable income to the homeowner.

To learn more about mortgage debt forgivenss, loan modifications, and/or to schedule a free consultation please contact your Dayton divorce law firm at Helen Wallace, Attorney at Law today by clicking on the preceding link, by e-mail to hw@helenwallacelaw.com or by telephone to (937) 654-6800.

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