What makes a bank decide if they will make you liable for the difference in a short sale or a 1099?

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What makes a bank decide if they will make you liable for the difference in a short sale or a 1099?

2007-07-23 12:27:35 · 2 answers · asked by L 1 in Business & Finance ➔ Renting & Real Estate

2 answers

Policy of the lender, OR their assessment of their chances of ever collecting the deficiency from the debtor.

2007-07-23 12:32:15 · answer #1 · answered by acermill 7 · 1⤊ 0⤋

State where the bank made the loan for making up the difference in a short sale.

Example: Arizona does NOT provide for banks going after the lender for the difference in the short sale.

Since the state does not provide for it, lenders won't persue it.

I believe all banks legally have to file a 1099-C in your name to the IRS for the amount of debt that was forgiven but congress is working on having that repealed.

Terry S.
http://www.Welcome2Arizona.com

2007-07-23 13:10:25 · answer #2 · answered by Terry S 5 · 0⤊ 0⤋