Home › Forums › Financial Markets/Economics › Avoiding jumbo loans– 2 conforming loans mortgage option? › In general, loans that are
In general, loans that are originated for a purchase are NON-recourse debt. (1st and 2nds)
Loans that are refinances are recourse debt. It DOESN’T matter if no cash is taken out, it’s still a refi.
If your purchase 2nd is a HELOC, it can get tricky.
PLEASE consult a tax professional if you are involved in a Cancellation Of Debt (COD) situation…
Link to details: http://www.irs.gov/faqs/faq4-4.html
