[GetSmart]

i am a new member and am looking for to helping newbie investors with short sales through my experience.

[877YouKeep]

Get smart, welcome. What is your experience? Are you familiar with removing 1099s?

[Gonetodocs]

OK cool we have a smart guy on the forums now. Right On.
What lenders have you had most of your experience with on the Loss Mit. /ShortSale side of the negotiations? what obstacles have you had to overcome and what creative negotiating solutions have you put together and with what lenders.

I have 6-7 years in the Mortgage Business and I am now just getting started in Loss Mit. with an emphasis on Homeowner retention. At least most of my clients can afford the home if they had a fixed monthly payment at their previous mortgage payment amount.

Anyway look forward to knowing you more and welcome again.

Sincerely,
Gonetodocs

[Corey1023]

The 1099 issue is really not that difficult unless the people doing a short sale have lots of money (how often is that the case?).

Under the IRS rules for a 1099-C (Cancellation of Debt) you can be excused from the liability for two reasons; Either you are currently or previously have declared bankruptcy on the debt that was canceled and or settled. Or, If you are insolvent and can demonstrate your insolvency to the IRS by making a comparison of your assets to your debts. If your debts exceed your assets and income you are by definition insolvent and can ask the IRS to absolve the 1099-C.

[Gonetodocs]

Corey's right,
It is IRS form 982 Reduction of Tax Attributes Due to Discharge of
Indebtedness (and Section 1082 Basis Adjustment) that cancels the debt. Also the Bush Administration has made it even more lenient for those borrowers that need this liability canceled.

Hope this helps. Search irs.gov for the form if you need it.
Gonetodocs