What is a mortgage loan forgiveness? How does it affect my credit?

I apply to get loan modification for my home loans 1st. and 2nd. both with the same bank…….and after 6-7 months they approve them both. I’m in trial for 3 months…how ever my tax guy told me not to pay the 2nd. loan because I can get a loan forgiveness on that loan ($ 70,000) is this true and legal…. he told me by next year the bank will send me a 10-99 form and it will go as income and I will have to pay taxes on the 70K (approx. $ 7K) better then paying $ 400 per month for the next 40 years……….can that be done…?
I owe 400k on the first loan and 70k on the second loan the hous is worth maybe 300k and I can hardly make the payments on the first one……….. I bought the house for 550k and put 150k as down payment…. it will be nice if it’s true that I can get rid of the second loan even if I pay taxes on that amount. Please any help will be appreciated. Thank you.

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