Forum

1099 (Forgiveness of Debt) Issued, Can Lender Still Try To Collect

Posted by Evelyn Blanks on May 14, 2012 at 6:07am in Short Sale Discussions

My Sellers were sent a 1099 (Forgiveness of Debt) in March 2010 on a second loan for the full amount of the 2nd loan.

They filed with their tax returns. 

 

We are now short selling the property, and the second lienholder is telling me Seller have to complete short sale process. 

 

Can lienholder try to collect after issuing 1099?

 

thank you

You need to be a member of Short Sale Superstars to add comments!

Join Short Sale Superstars

Email me when people reply –
Follow

Replies

  • Wendy Rulnick May 14, 2012 at 11:08am

    Evelyn - I would advise the sellers to contact an attorney.  

  • Wendy Rulnick May 14, 2012 at 6:34am

    Evelyn  - More background for the group - Why was a 1099 issued in March 2010?  Did the seller "settle" with the second lienholder then?

    • Evelyn Blanks > Wendy Rulnick May 14, 2012 at 10:25am

      Thank You Wendy, The 2nd  lienholder told me they "thought" the property had foreclosed.

This reply was deleted.
********************************** like buttons ************************