Real Estate Dispatch: Today’s Real Estate News 4-4-07

• IRS Kicks Homeowners While They Are Down, Washington Post

  “For homeowners who are seriously delinquent on their mortgages and hoping for relief, the Internal Revenue Service has bad news: If your lender agrees to modify your loan and forgive any of your debt, you could owe federal income tax on the amount forgiven.
  The Mortgage Cancellation Tax Relief Act of 2007 (H.R. 1876) would amend the tax code to exclude debt forgiveness on principal home mortgages from treatment as income.

  Introduced in mid-April by Reps. Robert E. Andrews (D-N.J.) and Ron Lewis (R-Ky.), the bill would allow lenders to restructure delinquent mortgages without worrying about income-tax hand grenades hitting their borrowers the next year. The legislation could assist many other homeowners in financial trouble who negotiate pre-foreclosure “short sales” or deeds in lieu of foreclosure, or those whose foreclosure proceeds are insufficient to pay off their mortgage debt.”

• 47% jump in foreclosures brings call for protection, El Paso Times

  “On Thursday, Sens. Charles Schumer, D-N.Y., Sherrod Brown, D-Ohio and Bob Casey, D-Pa., introduced a bill that would mandate tougher federal standards for mortgage lenders.

  But any new laws from Congress are far from certain. Senate Banking Committee Chairman Christopher Dodd, D-Conn., says increased regulatory oversight and voluntary actions by lenders are preferable to a government bailout. Dodd announced this week that several major participants in the mortgage market, including Citigroup Inc., JPMorgan Chase & Co. and HSBC Holdings Corp., agreed to adopt a set of principles for dealing with homeowners who face possible foreclosure.”

• Over 500 Foreclosed Michigan Homes Hit Auction Block, Giving Buyers Opportunity to Catch Deals, Earth Times

  “Sagging home sales combined with rising foreclosures create an opportunity for buyers to catch extraordinary deals on properties. Hudson & Marshall will auction more than 500 foreclosed homes for national lenders and asset management companies on May 19th - 24th in cities throughout Michigan.

  Over 300 homes will be offered in the Detroit area alone. It is expected that well over half of the Detroit area homes will be sold to high bidders for under $5,000, making this a great opportunity for first time and seasoned real estate investors to purchase bank owned properties.”

• Homeowners see steady home values: survey, Reuters

  “Homeowners see no change in the value of their homes in the year ahead, but expect home values to resume a moderate pace of increase during the next five years, a survey showed on Friday.

  The survey showed that one-in-five homeowners did not anticipate a change in the value of their home during the next five years, while a relatively large number of households expected a prolonged period of stagnation.”

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