Sunday, May 28 , 2017, 10:27 am | Fair 63º

 
 
 

Laurel Abbott: California Realtors Group Backs Mortgage Debt Forgiveness Bill

Last week representatives from the Santa Barbara Association of Realtors attended the California Association of Realtors business meetings in Monterey. It was a productive event.

There were forums to discuss how global real estate is starting to evolve, and what associations are dealing with on a local level. We performed committee work on our MLS rules, the forms we use in transactions, strategic planning, land use and more.

In celebration of the 100th year of the Realtor Code of Ethics, there is a task force dedicated to proposing new guidelines to uphold that code and professionalism in our industry.

We were also briefed on the legislation the organization will be sponsoring this year. Many have heard about the federal passage of mortgage debt forgiveness, but California has not passed any legislation yet. In an effort to have our state laws conform and help out underwater homeowners, the California Association of Realtors is sponsoring Senate Bill 30.

Written by state Sen. Ron Calderon, D-Montebello, this bill would exempt the taxation of mortgage debt that is forgiven when homeowners and their mortgage lenders negotiate a short sale or loan modification, including any principal reduction, for another year.

“We applaud Sen. Ron Calderon for acting so quickly on an issue that’s critical to the housing market,” CAR president Don Faught said. “We urge the California Legislature to also act quickly and pass a measure that will give hope to tens of thousands of California homeowners and provide the vital financial relief they need in order to make important personal financial decisions.”

The previous California exemption lapsed at the end of 2012, so forgiven mortgage debt is considered taxable state income for the time being. Upon passage of SB 30, the measure would be effective retroactive to Jan. 1, 2013. We are working toward that end.

Thanks to everyone who attended and gave of their valuable time, minds and efforts to keep California real estate progressing.

Laurel Abbott is a real estate agent with Prudential California Realty and president of the Santa Barbara Association of Realtors. Contact her at .(JavaScript must be enabled to view this email address) or 805.879.8050. The opinions expressed are her own.

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