We purchased our house in May of 03, for $310,000. In August of 05', we pulled 100,000 in a HELOC (value was $630K), and made some improvements to the house, purchased a car, paid off some existing credit card bills, etc. In Dec of 06' we combined the loans, into a Neg-ARM (bad decision)loan for what we owed with all fee's, $432,000) Now that the value of the house has dropped to less the $240K (attempted short-sale, buyer dropped out 3 days before close
)
Now, we have come to the point where the house is in foreclosure, and iwll be bank owned on Oct 2nd.
My question is, should we be held liable for taxes on the differnece of what we paid, vs what we owed? I have been told no, since Mr. Bush signed the forgiveness act. We are no in the process of filing Chp 7, due to over whelming bills, and being in the neg every month.
Has any one received a 1099b or 1099c after foreclosing, and have to pay the taxes on a similar situation?
We are stressed that we will have a fresh start with the Chp 7, only to receive a HUGE tax bill come tax time.
Any thoughts / comments are appreciated!
Thanks,
)Now, we have come to the point where the house is in foreclosure, and iwll be bank owned on Oct 2nd.
My question is, should we be held liable for taxes on the differnece of what we paid, vs what we owed? I have been told no, since Mr. Bush signed the forgiveness act. We are no in the process of filing Chp 7, due to over whelming bills, and being in the neg every month.
Has any one received a 1099b or 1099c after foreclosing, and have to pay the taxes on a similar situation?
We are stressed that we will have a fresh start with the Chp 7, only to receive a HUGE tax bill come tax time.
Any thoughts / comments are appreciated!
Thanks,