BOA to forgive mortgage debt around $150,000 for each home., page 2

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reply posted on 8-5-2012 @ 04:40 PM by Rockpuck

reply to post by CALGARIAN

Criteria: Must be 60 days or more behind on payments

Why be a good citizen? Huh? Seriously.. why pay my mortgage when the bank will give me better treatment if I default? Why have a job so I can pay tens of thousands in taxes and get nothing back? Why strive to feed my family when the Government will if I stop? Why work to keep my health insurance when "poor" people get free healthcare that I pay $500+ a month for? Why work my ass off for school, when the more I work the less aid I get?

The whole incentive in this country to be outstanding, to be a good citizen.. is that you have the hopes and dreams to one day crawl your way above the threshold where society finally won't !@$ you over, the government @!$ you over, the banks @!$ you over, everyone does their damnedest to !@$ you over.. even when so few of us actually do. So many of us end up somewhere in the middle to pay the fat cat corporate bastards their luxury lifestyle, while funding the "poor" and their life of careless irresponsibility.

!@$# this country.

edit on 5/8/2012 by Rockpuck because: (no reason given)

reply posted on 8-5-2012 @ 06:39 PM by antonia

reply to post by Rockpuck

That's what I was thinking. My husband and I didn't buy at the height of the market. We bought two years ago and we bought cheap. I mean come on guys-When the dumb people get into the market it's over. Don't get into that market.

Maybe I should just stop paying my bills and everyone will bail me out eh? I doubt it. BOA should pay if they were found to be fraudulently repoing houses and they should pay the people they hurt. This is a dumb deal.

reply posted on 8-5-2012 @ 06:52 PM by Afterthought

To those who are on the banks' side, are you suffering from selective memory loss?
How can you forget about those who were awarded modifications, then lost their homes anyways even though they were making their payments?
What about those who had their homes vandalized by mafia style tactics by the banks?
What about those who didn't buy more home than they could afford and still got shafted?
What about the Making Homes Affordable debacle that was Obama's baby and barely helped anyone because the bank always denied them for one reason or another?

I wouldn't ever wish bad things to happen to anyone, but you folks are near heartless and obviously have never been told one thing by a financial institution, then found out they lied to you through their teeth. Only having your own personal nightmare experience will help you gain empathy for those who are getting screwed by the banks.

reply posted on 8-5-2012 @ 07:01 PM by antonia

Originally posted by Afterthought
To those who are on the banks' side, are you suffering from selective memory loss?
How can you forget about those who were awarded modifications, then lost their homes anyways even though they were making their payments?
What about those who had their homes vandalized by mafia style tactics by the banks?
What about those who didn't buy more home than they could afford and still got shafted?
What about the Making Homes Affordable debacle that was Obama's baby and barely helped anyone because the bank always denied them for one reason or another?
.

Then pay the people who were harmed by those practices. This isn't paying those people. This is a throw away to pretend they are doing something when they aren't.

reply posted on 8-5-2012 @ 07:06 PM by Afterthought

reply to post by antonia

How do you know? Please provide proof.
I'm actually one of the people who has been royally jerked around by the bank while I was trying with every shred of my being to bend to their every whim and request. They lied to me and provided me with hollow promises so many times I've lost count. I am only one of thousands who are getting screwed.

reply posted on 8-5-2012 @ 07:17 PM by snowspirit

Originally posted by FissionSurplus
This is one of those "too good to be true" scenarios.

If they forgive up to $150,000 off your mortgage, you WILL BE TAXED on $150,000 as "income received" in that tax year. Portions of debts that are "forgiven" are considered income to the United States government.

You will not be ahead financially if you accept this, and will be taxed at the maximum rate.

This is probably another cooked-up government scheme to generate more tax dollars, and most people would be blissfully unaware until the IRS comes back at them with a humongous tax bill that they cannot pay. So, either you pay it, or they take all your stuff and/or put you in jail.

This "settlement' is not the same as B of A actually paying money. It actually is a windfall for them, as they reduce the $ amount of toxic assets, and prevent further foreclosures that they don't have the paperwork on to legally foreclose upon in the first place.

Sneaky and sleazy, coming to you in the form of a Trojan Horse with golden coins for eyes.

Your post was worth repeating.
$150,000 income taxed at the US tax rate. I'm not sure what your tax rate is, is it 30% approximately?
That's a nasty sized bill, almost $50,000.
On top of whatever other taxable income earned through the year.
Ouch.
For people that couldn't keep up with a mortgage, that's way worse.
How long do Americans get to catch up on taxes?
Debtor's prison, anyone?

reply posted on 8-5-2012 @ 09:44 PM by antonia

Originally posted by Afterthought
reply to post by antonia

How do you know? Please provide proof.
I'm actually one of the people who has been royally jerked around by the bank while I was trying with every shred of my being to bend to their every whim and request. They lied to me and provided me with hollow promises so many times I've lost count. I am only one of thousands who are getting screwed.

And they aren't helping you with this are they? If you do get this you will have to pay taxes on it. I don't think you have the thousands laying around to do it if you can't pay your house note. See the problem here? It doesn't hurt BoFA at all.

reply posted on 8-5-2012 @ 09:51 PM by Domo1

Damn't. Paid off the home loan 6 months ago. I was surprised how hard it actually was to pay off the loan. I kept getting transferred to different departments, they lost a huge check I had written them though my normal bank said they withdrew the funds. It took me almost a month to pay the thing off. BofA is too big, one hand doesn't know what the other is doing and the multiple departments trying to talk to each other takes forever. Never again will I do business with BofA.

reply posted on 8-5-2012 @ 10:25 PM by Daughter2

B of A are big fat liars! They also said they were going to modify tons of loans too!

The way credit reports work is that if you have a 60 day late mortgage payment your credit score goes down so much you might as well default on the entire balance. With a 60 day late on the books, you are going to have trouble buying a car, renting a house and getting a job. A foreclosure isn't going to make things that much worse.

Their not doing anything "nice". If the house goes into foreclosure, they will lose the money anyway.

reply posted on 8-5-2012 @ 10:36 PM by Afterthought

I was just doing some research on the tax issue and here's some links because it's just not as cut and dry as one may think. You do actually have some choices and it also depends on which state you live in.

money.cnn.com...

It is IRS policy to tax forgiven debt you are personally responsible for as if it is income. Say, for example, your credit card company settled a $10,000 debt for 50 cents on the dollar. You'd have a debt forgiveness of $5,000, which the IRS would count as income, just like your wages.

answers.yahoo.com...

If this is your primary residence, you have a choice.

You can include the money as income now (line 21 of 1040).

You can use form 982 and elect the mortgage debt forgiveness act and enter the amount forgiven on line 10B. This permanently reduces your basis in the property. If the property ever recovers and you sell, this amount becomes taxable when you sell as it is NOT eligible for the $250K/$500K exclusion.

Or you can use form 982 and try to see if you can exclude the amount under the insolvency rules, but then you have to prove you are insolvent and then reduce the tax attributes of what you have left, including the house. This means you can still end up with taxable income when you sell the house.

See IRS publication 4681.

In the cases BOA is going to forgive, I'm guessing they're going to begin with Florida and Nevada because these were the two states that where homeowners were hit hardest.

reply posted on 8-5-2012 @ 10:39 PM by Afterthought

reply to post by antonia

And they aren't helping you with this are they?

BOA is currently under investigation for how they handled my mortgage. After everything is said and done, I have plans to sue them for all the crap they pulled including calling the police to my residence for an inflated reason, lying to my attorney during a conference call, fraudulent lending practices, and breach of contract x2.

reply posted on 8-5-2012 @ 10:43 PM by Daughter2

Re: whether this is taxable - Congress passed the mortgage forgiveness act.

From the IRS site

www.irs.gov...=179414,00.html

What is the Mortgage Forgiveness Debt Relief Act of 2007?
The Mortgage Forgiveness Debt Relief Act of 2007 was enacted on December 20, 2007 (see News Release IR-2008-17). Generally, the Act allows exclusion of income realized as a result of modification of the terms of the mortgage, or foreclosure on your principal residence.

What does exclusion of income mean?
Normally, debt that is forgiven or cancelled by a lender must be included as income on your tax return and is taxable. But the Mortgage Forgiveness Debt Relief Act allows you to exclude certain cancelled debt on your principal residence from income. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief.

Does the Mortgage Forgiveness Debt Relief Act apply to all forgiven or cancelled debts?
No. The Act applies only to forgiven or cancelled debt used to buy, build or substantially improve your principal residence, or to refinance debt incurred for those purposes. In addition, the debt must be secured by the home. This is known as qualified principal residence indebtedness. The maximum amount you can treat as qualified principal residence indebtedness is $2 million or $1 million if married filing
separately.

Does the Mortgage Forgiveness Debt Relief Act apply to debt incurred to refinance a home?
Debt used to refinance your home qualifies for this exclusion, but only to the extent that the principal balance of the old mortgage, immediately before the refinancing, would have qualified. For more information, including an example, see Publication 4681.

How long is this special relief in effect?
It applies to qualified principal residence indebtedness forgiven in calendar years 2007 through 2012.

Is there a limit on the amount of forgiven qualified principal residence indebtedness that can be excluded from income?
The maximum amount you can treat as qualified principal residence indebtedness is $2 million ($1 million if married filing separately for the tax year), at the time the loan was forgiven. If the balance was greater, see the instructions to Form 982 and the detailed example in Publication 4681.

If the forgiven debt is excluded from income, do I have to report it on my tax return?
Yes. The amount of debt forgiven must be reported on Form 982 and this form must be attached to your tax return.

reply posted on 9-5-2012 @ 11:36 AM by antonia

Originally posted by Afterthought
reply to post by antonia

And they aren't helping you with this are they?

BOA is currently under investigation for how they handled my mortgage. After everything is said and done, I have plans to sue them for all the crap they pulled including calling the police to my residence for an inflated reason, lying to my attorney during a conference call, fraudulent lending practices, and breach of contract x2.

Ok, but how does sending out 150,000 in principal reduction for people who haven't paid their house note help you? I'm not you understand entirely what is happening here. This doesn't hurt them at all.

edit on 9-5-2012 by antonia because: opps

reply posted on 9-5-2012 @ 01:48 PM by Afterthought

reply to post by antonia

I understand perfectly fine.
If you would read one of my earlier posts, I stated that this is being done to get their investors to regain confidence in their company and increase the value of their stock.

I'm not sure you understand that those who work for these banks are white collar criminals. They ALL need to be investigated. One of the main reasons my mortgage is being investigated is because I wrote letters to anyone and everyone who would listen while keeping excellent records of our dealings. More people should've done this and I feel bad for those who didn't know their rights. The banks knew that people would buckle under the stress and simply give up instead of fighting. People need to know that they can get the upper hand no matter how big the entity is. Everyone has a fighting chance and the banksters are going to go down.

Since you are a new homeowner, you should be aware that the Comptroller of the Currency oversees the banksters. If you ever have a problem with your mortgage holder, you should contact OCC. That's the best advice I can give to anyone who owns a home and is still paying on their mortgage. Good luck with everything and I sure hope you don't get screwed like some who believed they also purchased wisely.

reply posted on 9-5-2012 @ 02:00 PM by BellaSabre

reply to post by snowspirit

I must have missed the part that it is "income". I don't believe it is, and certainly not "taxable income". It's for people who are out shopping for another mortgage company, who owe more on the loan than the house is worth, and BOA is trying to salvage their business, and not get in any more hot water for foreclosures that are partially their fault to begin with.

The article states there will be a "trial" period of 90 days to see if the homeowner can make the payment on time. If they do, the arrangement could be made permanent.

In no way, will they be writing a check to someone for $150,000, which would be taxable income. It's not income. You are having your mortgage adjusted.

reply posted on 15-5-2012 @ 03:34 PM by CALGARIAN