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Lenders Rescue Troubled Homeowners Via Short Sales

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The Tampa Tribune

Published: January 8, 2008

For homeowners in trouble, a short sale can be a good alterative to foreclosure. It doesn't help them keep the home, but it can keep the black mark of foreclosure off their credit report.

And, it's also a lot less expensive than going through the court system in a foreclosure lawsuit.

Short sales are becoming more common in the Tampa Bay area as the number of foreclosures rise and sales prices decline. Lenders, in an effort to avoid taking the home back, increasingly are accepting less than is owed. The process can be significantly less expensive than foreclosure for lenders and homeowners both.

Business, Page 1

•Under the Mortgage Forgiveness Debt Relief Act, homeowners who use a short sale won't have to pay taxes on the forgiven amount, up to the original mortgage amount on the purchase of the home.

•Before the legislation, homeowners who persuaded a lender to accept a short sale had to pay income tax on the loan amount forgiven by the lender.

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