sue
California,#2Author of original report
Thu, March 29, 2012
I was not aware of the taxes that must be paid. Thank you for the info. If the tax amount is not shockingly high I am sure that I could pay them. I read about the program on Moody's Analysis.
Memo # 11055 is on The Secretary of State's website. This sounds good to help underwater mortgages. How do I apply for it?
How does the Keep Your Home California Work?
Thank you
voiceofreason
North Carolina,#3Consumer Comment
Wed, March 28, 2012
Your report states you felt entitled not just to a modification, but to a principal reduction.
Modifications are not for reducing the principal. If anything they almost always end up increasing it.
They are intended to reduce the MONTHLY payment, and that is usually by reducing the interest rate, OR extending the life of the loan from 30 years to whatever it takes to make it affordable.
On top of that, accrued late fees and interest piled up from prior missed payments are usually factored in and bundled into the modified loan going forward.
Were you to actually get the principal reduced, the amount taken off would be TAXABLE income to you.
I don't know what you expected, or filed for, but I seriously doubt you were filing to get the principal chopped. Are you in a position to pay federal and state income tax on such a reduction, were it even possible?