Refinancing Home Mortgage
In: Mortgage Lenders
5 Jun 2010Foreclosure Advice
My wife and I live in a home that she purchased in 2005 before we married. She has two seperate loans, one for about $220,000 and another for about $40,000. Both loans are with the same lender and are the orignial loans for the home. I am not on any of the paperwork for the mortgage. A 4/08 appraisal valued the home at $220,000, I dont even want to know how much it has gone down since. I am fairly certain they cannot hold me accountable for the loan and am considering buying another home only in my name. Can they obtain a deficiency judgement and come after her for the balance? Could they come after a house that I purchase now that we are married? Who should I seek out for professional advice? Do I see a bankruptcy lawyer or some other type of lawyer?
This is about mortgage information questions.
3 Responses to Foreclosure Advice -State of MN?
Ken B
June 5th, 2010 at 8:21 pm
You should be safe as it pertains to the original mortgages taken out by your wife, If you are not on the documents or title to the home. You should keep your finances separate until this works out. You wife’s mortgage lenders will try to drag you in. As far as a judgment for the difference between what she owes and what they are able to get for the property, it will depend upon the mortgage documents and what type of security the bank has for the loan, in most cases the mortgage is on the property with no further recourse, read the Default section of the mortgage document. They may send a 1099 for the difference that she will have to pay taxes on.
You may want to check into a “Short Sale”. Many companies are accepting less than what is owed, and showing the mortgage as paid, as long as you find the buyer.
Good Luck!
bryan l
June 5th, 2010 at 9:16 pm
Hello.
sorry your home value has dropped in value that much. This type of advise would be with the help of a lawyer specializing in real estate/bankruptcy. They will look at short sale ect. If you are having trouble making payments ask for a modification.
lets say you want to forecluse her credit will be trashed for 7 years. as far as the balance they can get a judgement, but not you because MN is not a cummonial state. I typically give advise with credit card/car loan issues and i tell them to seek legal advise if they walked away from anything 5k or more. Potentaly walking away from 40k or more in your case, where backruptcy protection will exempt your wife to get here hard earned cash garnished. I am worried these bottom feeder debt collector jerk offs will take advantage of these huge right offs.
It may cost a few grand but seeing a bankruptcy/Real estate lawyer will definatly be in your best intrest through this process.
good luck
D
June 5th, 2010 at 9:47 pm
I have been in the foreclosure business for 8 years and I have to tell you although many states allow deficiency judgments, MN included, it is pretty rare that lenders sue for a deficiency. I have performed thousands of foreclosures and seen few deficiency judgments. That being said they can come after her but may not. I do not believe they can touch your assets. If you want professional advise talk to a real estate attorney in your area.
Finally, if you can afford the home or rent it out do so. Try to avoid foreclosure even if it is just in her name it is never a good thing to have on her record. The value will go back up someday if you can wait it out.