QUESTION
Debt issues without bankruptcy
Asked on Jan 20th, 2013 on Debtor and Creditor - North Carolina
More details to this question:
In 2009 I lost my job. I had a mortgage and a home equity loan with the same bank. I was able to get another job in a different state and had to move. I had a short sell set up, with a buyer, that would have covered the remainder of the mortgage and all of the home equity except for around $3,000. Before everything could close, the bank pulled out and canceled the short sale. The bank did settle on a transfer of deed in leu of fore closer and then I did not hear from them again. A few months ago I get a collection letter to pay the full amount of the home equity ($60,000). Throughout the whole process I did not hear or receive anything from the bank about the home equity loan. I do not want to file for bankruptcy but this issue is killing my credit. What are my options?
1 ANSWER
Bankruptcy Attorney serving Irvine, CA
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OKeefe & Associates Law Corporation, P.C.
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The first step in the analysis depends upon the anti-deficiency laws in your State, if there are any. If you are a CA resident and the same bank held the first and the second, recourse on the second may be limited. As a general rule you cannot foreclose out your own second and then seek recourse for the deficiency you created. The second step would involve weighing the merits of whatever claims you my have against the bank for the manner in whcih the residence was foreclosed on. This is not really my area of a practice. Attached is a link to a case that I had in CA court, but this would only be relevant if you were a CA resident. http://www.okeefelc.com/articles/index.php.
S. O'Keefe
Answered on Jan 21st, 2013 at 10:41 AM