Posted by Stamper_WI on 9/28/08 10:27pm
Msg #265658

Bailout for us?

Wasn't sure if this goes in politics or here. But one of the bailout provisions is a follows

"Stemming foreclosures: The bill calls for the government, as an owner of a large number of mortgage securities, to exert influence on loan servicers to modify more troubled loans.

In cases where the government buys troubled mortgage loans directly from banks, it can adjust them more easily."

Many of us have already done loan modifications. Perhaps there will be a lot more.
Here is the link to the full bill
http://i.cdn.turner.com/cnn/2008/images/09/28/ayo08c04_xml.pdf

Reply by Stamper_WI on 9/28/08 10:33pm
Msg #265659

Sec 109 (9) and 110 (13)

(2) MODIFICATIONS.—In the case of a residen14
tial mortgage loan, modifications made under para15
graph (1) may include—
16 (A) reduction in interest rates;
17 (B) reduction of loan principal; and
18 (C) other similar modifications.

Reply by Lee/AR on 9/29/08 5:54am
Msg #265666

I don't think so. Might be a lot of loan mods, but they don't pay as well, so, if I were looking for a job, I wouldn't let this news make me stop. We're in for a long haul turn-around (I hope), but they are also predicting a higher unemployment rate and expect the next 6 months to meet the definition of recession. There will always be NSA business...but it will no longer be anywhere near enough to stay full-time except for a rare few individuals in the right places. It really IS over. Believe it. If this is a person's only source of income, they're in trouble. It will be an occasional gig for a long time to come. JMO based on the pre-2000 market, which many notaries have never experienced.

Reply by BrendaTx on 9/29/08 6:30am
Msg #265667

Lee, you are on target.

**There will always be NSA business...but it will no longer be anywhere near enough to stay full-time except for a rare few individuals in the right places. It really IS over.**

It was the "gold rush" of our time.

"It will be an occasional gig for a long time to come."

That's right.

If you need a job to supplement that occasional gig do not put off finding it because it's hard to find one out there. Start looking hard. The sooner you start knocking, the sooner the door will be opened. It may not be what you want, but it has always been easier for me to find a job when I had a job.

Reply by Lee/AR on 9/29/08 7:17am
Msg #265668

I may be preaching to the choir, but

Employers don't much like self-employed people because they assume that you'll be a short-timer & will go back to 'whatever' as soon as possible. So...downplay your s.e. when job-hunting. Things are going to get worse before they get better and I don't believe I'm talking a matter of months...more like years--if ever.

Reply by BrendaTx on 9/29/08 7:51am
Msg #265670

Absolutely, Lee.

**Employers don't much like self-employed people because they assume that you'll be a short-timer & will go back to 'whatever' as soon as possible. So...downplay your s.e. when job-hunting. Things are going to get worse before they get better and I don't believe I'm talking a matter of months...more like years--if ever. **


Another idea for those who have access to it is temporary work.

Reply by Linda_H/FL on 9/29/08 8:40am
Msg #265672

Question...

My eyes glaze over when I get into this stuff...anyone in the know...

The modifications mentioned include "reduction in principal" - will the reduced amount be treated as income to the borrower, therefore taxable, or is there also a provision to waive the taxability of the forgiven amounts? TIA

Reply by DebbieT on 9/29/08 9:14am
Msg #265674

Re:Good question Linda. I would like to know also. n/m

Reply by Lee/AR on 9/29/08 9:29am
Msg #265679

Re: Re:Good question Linda. I would like to know also.

I believe I saw some fin'l advisor's site who said 'yes, it will be taxable'. We're bailing out the banks investors and the economy, people. Not the folks who are losing their homes--they still have a lot of 'qualifying' to do before being 'saved'.

Reply by KODI/CA on 9/29/08 11:07am
Msg #265684

Re: Re:Good question Linda. I would like to know also.

Under the current tax laws that I work with as a California Registered Tax Preparer, any and all reductions in principal by the lender would become taxable income and taxed at the rate that the taxpayer falls under.

Reply by WDMD on 9/29/08 12:01pm
Msg #265694

Re: Re:Good question Linda. I would like to know also.

"Under the current tax laws that I work with as a California Registered Tax Preparer, any and all reductions in principal by the lender would become taxable income and taxed at the rate that the taxpayer falls under."



I would think that any debt forgiven COULD possibly fall under the Mortgage Forgiveness Debt Relief Act of 2007. Link:

http://www.irs.gov/individuals/article/0,,id=179414,00.html

Reply by PAW on 9/29/08 12:10pm
Msg #265696

Mortgage Forgiveness Relief is a good possiblity

Especially if the loan falls within the guideline of the Act. The biggest salvation for the homeowner is that it is limited to principle residence mortgages. This eliminates the speculator (who buys for investment and flipping purposes) from recovery, as it should be. A speculator is called a speculator for a reason and needs to assume the responsibilities and liabilities that speculation brings.

Reply by KODI/CA on 9/29/08 12:13pm
Msg #265697

There are exceptions.

"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, "Debt used to refinance your home qualifies for this excluson, but only up to the extent that the principal balance of the old mortgage, immediately before the refinincing, would have qualified". This only applies to tax years 2007, 2008, and 2009. If the debt is excluded from income it still must be reported.