Posted on: 27th Oct, 2009 05:53 pm
I received papers notifying of pending foreclosure by the city for unpaid taxes (due to the banks mistake in paying the taxes out of my escrow). The papers state that after foreclosure "A Person holding legal interest in this property will lose that interest as a result of the foreclosure proceedings".
The bank will lose the ability to foreclose on this house, correct? And the ability to pursue a deficiency judgement? I do not want the house but also don't want them garnishing my wages after a foreclosure. Could this be a loophole? What other recourse would the bank have against me if the City forecloses?
The bank will lose the ability to foreclose on this house, correct? And the ability to pursue a deficiency judgement? I do not want the house but also don't want them garnishing my wages after a foreclosure. Could this be a loophole? What other recourse would the bank have against me if the City forecloses?
Hi Guest,
If the city forecloses on your property for unpaid taxes, your lender will not lose the right to sue you for the loan balance. The property will be sold at an auction and the sale price will be used to satisfy the tax lien. The left-over money will be used to pay off the mortgage debt. If the money is not enough to pay off the loan in full, you will be responsible for the deficiency. The lender can come after you to recover the balance on the loan.
If the city forecloses on your property for unpaid taxes, your lender will not lose the right to sue you for the loan balance. The property will be sold at an auction and the sale price will be used to satisfy the tax lien. The left-over money will be used to pay off the mortgage debt. If the money is not enough to pay off the loan in full, you will be responsible for the deficiency. The lender can come after you to recover the balance on the loan.
These programs that tell you that tax foreclosures are a good deal are normally scams.
People do make a little money off them but in most areas it is not to really buy the property. Most people "buy" them at auction, and then get paid back by the original owner plus interest. It is the interest that is their profit. In most areas the original owner is allowed to re-buy the property for what you paid at auction plus interest for an extended time (in some areas it is two years).
That prevents you from wanting to spend money on fixing it up or moving in.
People do make a little money off them but in most areas it is not to really buy the property. Most people "buy" them at auction, and then get paid back by the original owner plus interest. It is the interest that is their profit. In most areas the original owner is allowed to re-buy the property for what you paid at auction plus interest for an extended time (in some areas it is two years).
That prevents you from wanting to spend money on fixing it up or moving in.