Discussion on Mortgage woes causing some to walk away

Schumpeter Reincarnate Joined: 24 May 2008 Posts: 46255

http://ml-implode.com/viewnews.....kaway.html

Dyn-o-mite! Joined: 09 Jan 2008 Posts: 389

This article mentions the exposure to the IRS. Spoke to a friend of mine who works for a major bank and is doing loan modifications. THEY ARE SENDING 1099's to you if you default. Imagine getting that tax bill for next year if the default is 100K or more!

Dyn-o-mite! Joined: 01 Jul 2008 Posts: 366

It doesn't matter if the bank sends 1099's. The tax on such "phantom income" is forgiven.