Janets home was foreclosed upon and the mortgage holder issu

Janet\'s home was foreclosed upon and the mortgage holder issued her a Form 1099-A. What is the sales price Janet must use to report the foreclosure if the loan was nonrecourse, the outstanding balance of the loan was $99,000, and the fair market value of the home was $108,000 on the date of foreclosure? *

Solution

$99000

This is because Janet has eventually received $99000 in return for the home. For non-recourse loans, the lender cannot ask for further repayment after foreclosure. The sale price is considered to be the outstanding loan amount.