Tax forgiveness after HARP 2 Refinance and Short Sale?

kickin'thetires

LoanSafe Member
Mar 24, 2011
4
0
0
Hello,
I refinanced with HARP 2 about 6 months ago. The neighborhood in the last few months has become unbearable. I want to move and short sale in California. The question is will I receive forgiveness on taxes under the mortgage forgiveness tax debt relief act extended through this year? I know generally if you have refinanced and not cashed out, you can be forgiven for the amount of the original loan. I am not sure with this HARP 2 refinance. I do not think this should affect the forgiveness but since both are government programs I want to be sure. I did refinance through the original lender of the loan.
Thanks in advance for any advice you may have.
 

Cat Damiano

Mortgage Wars
Sep 10, 2007
10,541
39
48
Colorado
www.loansafe.org
Hello,
I refinanced with HARP 2 about 6 months ago. The neighborhood in the last few months has become unbearable. I want to move and short sale in California. The question is will I receive forgiveness on taxes under the mortgage forgiveness tax debt relief act extended through this year? I know generally if you have refinanced and not cashed out, you can be forgiven for the amount of the original loan. I am not sure with this HARP 2 refinance. I do not think this should affect the forgiveness but since both are government programs I want to be sure. I did refinance through the original lender of the loan.
Thanks in advance for any advice you may have.
There is a Q&A along with information about the type of debt that is forgiven here;

The Mortgage Forgiveness Debt Relief Act and Debt Cancellation

However, keep in mind that there is always the possibility that a short sale will go beyond the end of the year. I would also recommend that you speak to a tax professional in your state to see if the refinanced debt would be forgiven.
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Jan 14, 2011
2,101
181
63
San Diego, California
www.loansreduced.com
If you're able to short sell while being current, you can obtain financing on an owner occupied home through FHA immediately!

Just a thought!
 

ndebt86

LoanSafe Member
Jul 22, 2011
16
0
0
Read the q and a but would like to b sure on this.If I sell my home in 2013 for less than what it was appraised for when I re-fied 8 yrs ago,can I deduct the difference on taxes?Also,another question,if I get enough to pay off the first lien but am short on the second(80/20 re-fi),are there any problems I would encounter with the second?
 

Cat Damiano

Mortgage Wars
Sep 10, 2007
10,541
39
48
Colorado
www.loansafe.org
Read the q and a but would like to b sure on this.If I sell my home in 2013 for less than what it was appraised for when I re-fied 8 yrs ago,can I deduct the difference on taxes?Also,another question,if I get enough to pay off the first lien but am short on the second(80/20 re-fi),are there any problems I would encounter with the second?
These are questions that you would need to ask your tax person or a tax professional in your state.