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Attorneys At Law

Attorneys practicing in and around the Chicagoland area. Experienced in the practice areas of Real Estate Law, Mortgage Foreclosure Defense Litigation, Business Law, & Estate Law.

Attorneys At Law - Attorneys practicing in and around the Chicagoland area. Experienced in the practice areas of Real Estate Law, Mortgage Foreclosure Defense Litigation, Business Law, & Estate Law.

Category Archives: Legal News

Using Technology to Manage a Growing Real Estate Practice – 3/13/14

Don’t miss this informative session presented by Jane Oxley of Smokeball.  Jane will cover the following topics:

  • How to collaboratively manage your emails and documents
  • What is the Cloud?
  • Document Automation
  • Keeping Your Data Secure
When: 3/13/2014
11:45
Where: Attorney Resource Center
505 N. County Farm Rd.
3rd Floor
Wheaton, Illinois  60187
United States
Presenter: Jane Oxley
Contact: Leslie Monahan
lmonahan@dcba.org
Phone: 630-653-7779
REGISTRATION INFORMATION
Online registration is available until: 3/13/2014

You must be a current DCBA member to receive credit for MCLE Committee meetings.  Please register in advance to ensure enough food and materials for all.

CHASE has changed its short sale application process.

Beginning in January:
To better assess customer needs and support implementation of the Dodd-Frank Act, clients will now submit a Full Mortgage Assistance Application to be evaluated for all available mortgage assistance options, including eligibility to pursue a short sale.

Within 30 days of receiving their completed application:
Clients will receive a complete list of their available mortgage assistance options, including conditional short sale approval.

Here’s what you can do:
Encourage those who need mortgage assistance to obtain the Full Mortgage Assistance Application by calling us at 1-866-550-5705. Your clients will receive information and instructions based on their specific situation.

Resources:
Visit chase.com/ShortSaleAgentInfo or call us at 1-866-233-5320 for the most current information about the program process and requirements.

The CFPB is Requesting Information from Consumers and Market Participants About the Mortgage Closing Process

The Consumer Financial Protection Bureau (CFPB) is requesting information from the public regarding the mortgage closing process. The goal of this request is to identify what the CFPB calls “pain points,” or problems that people experience through the closing process and how these problems may be remedied with technology and innovations in the market.

The CFPB wants to use this information to help develop a closing process that is more streamlined, efficient, and educational to accommodate the mortgage industry’s increased usage of technology, electronic signatures, and paperless processes. This data request is part of the CFPB’s Know Before Your Owe initiative. The goal of this initiative is to identify how the mortgage closing process can be improved for consumers and real estate professionals and encourage developments that will increase the knowledge, understanding, and confidence of the consumer during the closing process.

The CFPB is offering the opportunity to market participants, consumers, stakeholders, and real estate professionals to relay their experiences of the closing process to help improve it. The information that is submitted will give the CFPB a better understanding of the common problems that consumers and professionals face during the process as well as a better idea for improving the experience.

For NAR professionals, this information request provides the perfect opportunity to offer their expertise and views regarding the current closing process to help improve it for all involved.

Important Info:

 Dates: The last date to submit your comments to the CFPB is February, 7 2014.

Addresses: Electronic Delivery: Go to http://www.regulations.gov  and follow the instructions for submission.

Mail/ Hand Delivery/ Courier: Monica Jackson, Office of the Executive Secretary, Consumer Financial Protection Bureau, 1700 G Street NW., Washington, DC 20552

Instructions: Include the document title and docket number with each submission. The CFBP encourages electronic submissions due to the delays in paper mail in the Washington, DC area. All comments received will be available for public viewing without change at http://www.regulations.gov. They will also be available to the public at 1700 G Street NW., Washington, DC 20552 on business days between the hours of 10 am and 5 pm.

For additional information, contact Monica Jackson, Office of Executive Secretary, at 202-435-7275.

IRS Offers “Insolvency Clause” as Tax-Saving Alternative to Expired Mortgage Forgiveness Debt Relief Act

December 31, 2013 marked the expiration of the Mortgage Forgiveness Debt Relief Act which means homeowners are no longer protected from being taxed on their forgiven mortgage debt after going through a short sale or foreclosure.  A short sale can now only qualify for the Act’s tax exemption if the transaction was closed before the December 31, 2013 expiration date.  Mortgage debt that is forgiven by a lender is normally considered taxable income without the Mortgage Forgiveness Debt Relief Act, but the IRS is offering a way for people to avoid being taxed on forgiven mortgage debts.

IRS “Insolvency Clause”

Homeowners that are facing a short sale or foreclosure and are worried about having to pay taxes on their forgiven debts may not be aware that they could qualify for tax relief through the IRS “insolvency clause.”  With this clause, a seller is exempt from paying taxes on a forgiven debt to the extent that they are insolvent.  What this means is that if the amount of a seller’s debts and liabilities is greater than their assets by more than the portion of the debt forgiven, they are exempt from paying taxes on the forgiven debt.

Example of the “Insolvency Clause”

For this example, a homeowner has a house worth $200,000 but a mortgage debt of $350,000.  The owner short sells the home for $200,000 and the bank forgives the remaining debt of $150,000.  This forgiven debt is initially treated as taxable income by the IRS.

Now the principles of the insolvency clause can be applied. First, add up all debts and liabilities as well as your assets. The IRS expects you to list the mortgage debt as a liability and the fair market value of the house as an asset. If your total assets amount to $500,000 and your liabilities are $650,000, you have a $150,000 insolvency.

In this scenario, the insolvency amount of $150,000 matches the forgiven mortgage debt of $150,000 which makes the homeowner exempt from paying taxes on the forgiven debt. Every dollar of the forgiven debt is protected up to the insolvency amount. So if the insolvency in this scenario was $100,000, the homeowner would still pay income tax on the remaining $50,000 of the forgiven debt.