Then, you can read here and what people are saying about specific deals or circumstances will make more sense.Jon

As far as a 1099 yes the lender will write off the loss and send the debtor a 1099 (almost always) which is treated as income and taxable by the debtor… However, there is a new law that just went into effect and under the right circumstances it makes it so the lender can not 1099 the debtor.

If there is no sale we'll be looking for the largest box we can find to live in as there is no way (that I know of) to get enough funds to buy a home on the other end; we qualify for about $40k under our current circumstances as I am carrying a lot of debt from business charges on credit cards for our start-up business which has not started to pay me back for anything to this point.

If through the life of the loan, he has never been late, then he can add to that argument that he has never been late before and this hardship posed an extreme circumstance.

Well, 1% MIGHT work under the right circumstances.

When you add all that up, it will eat more than your monthly posted cash flow over the long haul.Now, if you bought in an area where you could likely expect great future appreciation and could sustain negative cash flow in exchange for the tax deductions and future large appreciation, then perhaps you have a decent deal for yourself under such circumstances.

I heard something to the effect of approx 5% for OR, or specifically the Portland area, although may be Eric Foster can help me out on this one it may be higher or lower given recent market circumstances in the US.

Does anyone have any stories about being force into dealer status on a particular deal and if so, what were the circumstances?

You and I might not do the deal, and not budge on price, but someone else might, and their circumstance is different.

The entire firm is separated into 3 distinct departments, marketing, maintenance, and collections.