Todays Kimberly Blanton Update
Kim gets 2 mentions today.
First, she writes what at first glance seems to be a pretty good article about “short sales” What makes it different than most of these “homeowners lose house” story is first the successful short sale aspect and second the lack of the “homeowner as a victim” angle.
The husband lost his job and now they can’t afford to pay the mortage(s) after refinancing. Reasonably standard stuff. No tales of woe about how they got taken advantage of by a mean mortgage broker and no story of “medical bills” being involved.
What makes the article bad and bad it is, is what she left out. That couple that executed a “successfull short sale” and skeedaddled to North Carolina where they bought a new, cheaper house is in for a big tax bill. The difference between what they owed on their old house and what the bank accepted for the sale price is whats called “forgiven debt”. Or as the IRS likes to call it, Income.
In this case, $168,000. 1/3 of that leaves them with a $56,000 tax bill.
And the IRS will get their money. Short of bankruptcy (which is now much more difficult) there is no walking away from that debt.
Writing an article on short sales without a single mention of the tax implications is just poor work. I wonder how many strapped homeowners read that article and now think they have a chance to save themselves from financial ruin when if you factor in the IRS hit, it’s a bad option.
Kim’s second item comes from a story she writes about Countrywide Financial. The same Countrywide financial that Kim said “Depeleted” an 11.5 billion dollar line of credit a few days ago.
Totally false of course.
Today she “corrects” (sort of) that falsehood here (the very last line of the story).
Countrywide drew down a $11.5 billion line of credit from its banks to replace funds that Wall Street investors no longer can provide by purchasing mortgages
“Drew Down”??? What does that mean. Stocky thinks she’s still insinuating that the line of credit has been “depleted”.
Maybe it’s because of media types like her that we have what she describes in the beginning of the article:
Some real estate agents no longer refer their home buyers to Countrywide, the nation’s largest mortgage lender, because they fear it would be unable to fund the mortgage at the closing table, loan brokers said. And some depositors, particularly retirees, have been concerned about the safety of their savings at Countrywide’s banking unit, even though their balances are federally insured up to $100,000.
Gee, some people are concerned about CountryWide continuing in business???? Where could they be getting that idea??????