My home was foreclosed & auctioned at a lower price that the mortgage. Will the lenders send me a 1099?

Question

My home was foreclosed & auctioned at a lower price that the mortgage. Will the lenders send me a 1099?

Answer 1

They could, it depends on the bank and the loss.

Answer 2

In many cases, yes they will.  The difference between what you owed and what the house was sold for can be considered income for you, and the IRS will want their piece of that.

Answer 3

If they "forgive" the shortage (rather than suing for the balance) then yes, they will send you a 1099 for the shortage. For in their mind, they gave you that money.

Answer 4

Depends on when it happened and a few other details. Read up: http://www.irs.gov/newsroom/article/0,,i...  

Answer 5

Yes it is likely. If you received cash from a refi you likely owe taxes. Also the difference between your purchase price and sale amount may be taxable. There are very few default judgments taken if you are collectible you may want to speak to an attorney.  

Answer 6

yes and probably sue for the balance

Answer 7

If they write it off they will send you a 1099 and it will count as income and you will owe taxes on it. If not then they can sue you for the difference and you will be required to pay the difference unless you file for bankruptcy.