Foreclosure Experts Urge Tax Reform to Aid Consumers after Foreclosures, Short Sales

ANNAPOLIS, Md., April 14 /PRNewswire/ -- Foreclosure experts at USHUD.com and Heavy Hammer Inc. today urged changes to The Mortgage Debt Relief Act of 2007 that would extend the life of the legislation and expand benefits for homeowners affected by the housing crisis.

The Mortgage Debt Relief Act of 2007 allows homeowners to avoid paying taxes on mortgage debt forgiven though the foreclosure or loan modification process under certain conditions, but will expire in 2012. Heavy Hammer Inc. CEO Michael Urbanski has called for a five-year extension to the legislation, and an expansion giving tax protection to those who lost investment properties or refinanced to pay off student loans and other debt.

"Homeowners who bought investment properties are not villains," said Urbanski. "Levying crushing taxes on those who have already lost so much will only strip private individuals of their personal wealth and further impede financial recovery." 

The IRS taxes any money taken out of a property and spent on anything other than home improvements. The presumption is that money spent on home improvements reduced a lender's liability in foreclosure, but those who used their homes as ATMs and splurged should pay for their irresponsible behavior. Urbanski argues some lenders required homeowners to pay off credit card debt as part of their refinancing agreements, and consumers should not be penalized for settling unsecured debts, especially high-interest credit cards. Those with investment properties have also taken considerable losses in the housing crisis. The National Association of Realtors reports the median price paid for investment properties fell 43 percent between 2005 and 2009.

"The same government that bailed out too-big-to-fail Wall Street firms without blinking an eye, should have no qualms about offering modest tax relief to American families who have been devastated in this economy," said Urbanski. "Tax relief is the answer, not punishing those who provide housing for the less fortunate."

Headquartered in Annapolis, Heavy Hammer Inc., is an online networking and consulting company advocating for American homebuyers, connecting them with trusted experts and valuable resources. Driving one of the most widely used suites of foreclosure Web sites, Heavy Hammer delivers free, all-inclusive lists of foreclosure properties to more than 500,000 homebuyers monthly. In business since 1998, Heavy Hammer has focused on geographically-based ad serving technology and processes allowing thousands of professionals connect directly with consumers in specific locations. Starting with USHUD.com, this group of sites now includes more than 30 state- and region-specific sites.

CONTACT:  Joe Chenelly, +1-410-357-1123,  [email protected]

SOURCE Heavy Hammer Inc.