foreclosure 1099
im confused!some say with foreclosure,no 1099 will be issued by lender compared to short sale………?
where the balance will be considered tax liablility.but others say the opposite.which is which??which is better–foreclosure or short sale?
There is a new law regarding short sales that will be in effect until 2012. You will still get issued a 1099 by the lender but you do not have to pay taxes on the amount if you are an owner occupant of the house. A short sale is a much better option if you can do it. You will take a much lighter hit on your credit- usually around 50 points as opposed to 150 for a foreclosure. It also does not stay on your credit for 7 years like a foreclosure. Your realtor can work with the bank for you to get a short sale done.
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