Stop Paying?
Hi All,
I have purchased a condo in Florida as an investment and its market value now is $190K, however I owe the bank $300K. It is rented but every month I have to pay about $1,500 out of pocket to cover mortgage, HOA fees, etc.
I am planning to stop paying the mortgage and I do not care about my credit score as I live abroad and do not plan to go back to US for at least 10 years.
As there is a private mortage insurance in place, if I am in default I assume that the insurance co will get the property and the bank will get paid, but: is the insurance company going for deficiency judgements or similars? I still have some savings in US banks. Then, are they going to chase accounts/assets also outside US?
You should speak to your accountant since any forgiven debt arising from a short sale will be considered taxable income.
SSP, I think Bush "fixed" this with H.B. 3648, passed in December 2007:
At the White House bill signing, this afternoon of 12/20/07, George Bush made these comments: “…The bill I sign today will help this effort by ensuring that refinancing a mortgage does not result in a higher tax bill. Under current law, if the value of your house declines and your bank or lender forgives a portion of your mortgage, the tax code treats the amount forgiven as money that can be taxed. And of course, this makes a difficult situation even worse. When you’re worried about making your payments, higher taxes are the last thing you need to worry about. So this bill will create a three-year window for homeowners to refinance their mortgage and pay no taxes on any debt forgiveness that they receive….”
Full text at: http://www.whitehouse.gov/news/releases/2007/12/20071220-3.html
Yes, but I think this applies to houses that are owner occupied, but not for investments like this one.
Are your filings by state or county? IN NC, everything is by county.
If you are searching county databases, look for similar document types. In my county, for instance, there are no "LIS PEND" document types, but there are "SUB TRUSTEE" filings. Actually in my county they are "S TR" and in Johnston county they are "SUB TR". We are a trustee state, obviously. Foreclosure filings are the same deal. "FORE NOTICE" when a foreclosure is "final" (after final accounting) but each county has a different code/number. All the forms look similar, though... when you eventually find them.
so much for uniformity.