Mortgage Foreclosure & Refinance Resource

According to a statement released by Speaker Nancy Pelosi there are some interesting laws coming to help homeowners who are facing or are in foreclosure.  One of the bills modifies the way IRS treats the forgiven mortgage balance and the other helps those in bankruptcy negotiate with lenders. Details below:

End Taxes on Mortgage Debt Forgiveness: The House passed a bipartisan bill to end the tax on phantom income when a lender forgives some part of a family’s mortgage in foreclosure. Under current law, the debt forgiven
following mortgage foreclosure or renegotiation is considered income for tax purposes, resulting in tax liability for individuals and families. The bill provides tax relief by permanently excluding this mortgage debt
forgiven under these circumstances from taxes. (H.R 3648, Mortgage Forgiveness Debt Relief)

Fair Treatment for Homeowners in bankruptcy: The House Judiciary Committee is considering legislation to prevent up to 600,000 Americans from losing their homes in bankruptcy over the next two years — by giving
bankruptcy judges the ability to revise mortgage contracts on primary mortgages, much as they already do when sorting out payments to other kinds of creditors and other mortgages, such as vacation homes. This bill will
permit bankruptcy courts to give homeowners more time to pay their mortgages with more reasonable interest rates. (H.R.3609 Emergency Home Ownership and Mortgage Equity Protection Act of 2007, Rep. Brad Miller)