Chapt 7, Reaffirmation and now in a bind!!

[Chowder]

As for a short sale - I never have and never will trust a BANK.

Smart. And you'd still have that 1099 for the dif.

[debee]

The lawyer could oversee the short sale or DIL as well. DIL is the fastest and cleanest way out. You get out of the house and there is no deficiency to worry about. It's done. Everything is over and done.

It seems risky to me to abandon the sure thing and gamble on beating the lender on the deficiency. Suppose you lose?

short sale/dil = you walk, no deficiency.
foreclosure + fight to get out of deficiency = you pay for that fight and risk losing.

As for the 1099 you'll receive for any amount of "forgiven" debt, that applies to foreclosure as well. You may want to look into the Mortgage Forgiveness Debt Relief Act.

[bkDude]

As mentioned above, what about rescinding the Reafirmation agreement. Is it too late? Would that help? Questions for your lawyer I suspect.

BKDude in CO

[tcreegan]

Hi all,

I saw somewhere that in 2007 the rules on 1099's changed and it is non-taxable if it came from your primary residence...

Not sure if that relates to anything, just thought I would throw it in...

Tom in Colo