QUESTION
How do I know if my mortgage company is truly discharging my mortgage and will be sending a 1099-c?
Asked on Jan 07th, 2016 on Taxation - Michigan
More details to this question:
We fell behind in payments and called to make arrangements. The company said they were not foreclosing and that it wasn’t worth it. Title search shows a discharge letter filed with the county. Do I owe the $34,000? They said I would receive a 1099-c in the mail.
2 ANSWERS
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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You can only take them at their word, and in accord with their communications with you. See an attorney with the documentations for firm advice. It is possible for them to release the lien but not the note.
Answered on Jan 29th, 2016 at 4:36 AM
You haven't provided enough information to answer the question. The lender has discharged the mortgage, but has it released you from liability to repay the loan? The mortgage is only an instrument to secure your obligation to repay the loan. You would only have discharge of indebtedness income if you were released from the obligation to repay the loan.
Answered on Jan 29th, 2016 at 4:36 AM