Short Sales on the Decline: Since the expiration of the Mortgage Forgiveness Debt Relief Act, homeowners have 
been thinking twice about proceeding with a short sale. A sharp drop in short sales began at the start of this year, likely because of the increase in taxes borrowers will now have to pay on forgiven debt, Khater says. The MFDRA exempted borrowers from paying taxes on any mortgage debt forgiven by a lender in a short sale or loan modification. Since the act expired on Dec. 31, 2013, borrowers now will have to count forgiven mortgage debt as income on their federal tax returns. Congress has yet to renew the act, read more
been thinking twice about proceeding with a short sale. A sharp drop in short sales began at the start of this year, likely because of the increase in taxes borrowers will now have to pay on forgiven debt, Khater says. The MFDRA exempted borrowers from paying taxes on any mortgage debt forgiven by a lender in a short sale or loan modification. Since the act expired on Dec. 31, 2013, borrowers now will have to count forgiven mortgage debt as income on their federal tax returns. Congress has yet to renew the act, read more
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