P.S.   Regarding H.R. 3648, President George W Bush stated:   

“My administration has taken strong steps to help homeowners avoid foreclosure…The provision will increase the incentive for borrowers and lenders to work together…So this bill will create a three-year window for homeowners to…pay no taxes on any debt forgiveness that they receive.”    President George W. Bush

So, if you are behind on your mortgage and want to avoid foreclosure which will save your credit from further damage, I’d like to introduce Program 3648, a nationwide initiative whose mission is to:  1)  Help homeowners receive the morgage debt forgiveness this new law encourages.  2)  Rescue as many homeowners from public foreclosure as possible. 

Provided you go through the proper process, your mortgage company may be willing to completely forgive your mortgage debt.  Furthermore, the portion they forgive, under H.R. 3648, is no longer counted as personal income like it used to be if it is your primary residence (your tax person can advise with any exceptions).