Whenever he thought about it, he felt terrible. And so, at last, he came to a fateful decision. He decided not to think about it. ~John-Roger and Peter McWilliams
Question #53692 posted on 10/01/2009 3:01 a.m.
Q:

Dear 100 Hour Board,

What qualifies as a "principal residence" under the mortgage debt relief act of 2007? For instance, we have a residence that we moved out of 1 year ago and could not sale. Can that qualify?

- Anonymous

A: Dear Anonymous,

In general, "principal residence" is a slightly fluid term. Although from 2005, this article explains pretty well what a principal residence usually means. The most basic definition, and that which is used in the Mortgage Debt Relief Act of 2007, is the main place of residency for the people involved. If a person has more than one home, then the one in which they usually reside is considered the principal residence. This entire act does not apply to second homes at all. If a person decides to change their second home to their principal residence in the eyes of the law, then the act will apply no more than $250,000, or $500,000, to that home in comparison to the original principal residence, depending on the circumstances. I found much of this information on this website.

If you are not living in the residence, then it should not qualify. As I mentioned, you can technically change a second home's status to that of principal residence; however, the Mortgage Debt Relief Act will not affect it in the same way as it would have. If you want to push it as your principal residence, you always have the option of consulting with a lawyer to see what other options you have.

-Mico