The first proposal is for FHA refinance, the next option would be tax relief for those who have gone into foreclosure. FHA has instated the FHA Secure Act which loosens the criteria for refinancing. The backing of FHA will assist borrowers with credit problems, or who may be more of a risk with finding more options.
If a borrower finds himself beyond the point of refinance, as a result of a government push, lenders are being encouraged to push tax relief. Currently, any debt which isn’t recovered with the sale of the home is treated as taxable income. Lenders will now be asked allow any debt that can not be recovered with foreclosure, to be forgiven and not taxed.
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