Posted on: 06th Feb, 2009 07:33 am
How long after a short sale does the lender have to file a defeciency judgement?...I have 6 rental properties and only 1 is underwater. I owe $211,000 to Wells Fargo. Full Doc Investor Condo. The property is worth $90,000 on a good day short sale today. I am not behind yet, but the tenant moved out. $1700 cost per month to own. New rent maybe only $750 or even $700. So, no more payments from me is my plan.
If I can get a short sale in 6 months, I will owe all the interest not paid and the penalties, the taxes and condo dues not paid. My current deficit $211 - 80K (net) is $130K and it will be another 25K from the past dues.
The lender will want me to take back a note for $155K. I will say "no" and by some miracle they will agree to the short sale anyway. They will file a judgment. But when? They are so backed up. I have heard they have up to 5 years to file.
Also, the subject property is in another county. I read that a creditor has to file a certified copy of the judgment in each county that the debtor may have real property. The judgment against general assets is statewide automatically in Florida. Am I correct about the real property filing requirement? Does anyone have any experience with how nimble the lenders are about finding and filing? Last question, if they have a judgment, they also have to take steps to seize the assets. Because my assets are real property, is it easier to find and/or seize them? If there is a judgment out there and I sell another property, what is the mechanism (if any) that automatically requires those proceeds pay off the judgment? Any thoughts?
If I can get a short sale in 6 months, I will owe all the interest not paid and the penalties, the taxes and condo dues not paid. My current deficit $211 - 80K (net) is $130K and it will be another 25K from the past dues.
The lender will want me to take back a note for $155K. I will say "no" and by some miracle they will agree to the short sale anyway. They will file a judgment. But when? They are so backed up. I have heard they have up to 5 years to file.
Also, the subject property is in another county. I read that a creditor has to file a certified copy of the judgment in each county that the debtor may have real property. The judgment against general assets is statewide automatically in Florida. Am I correct about the real property filing requirement? Does anyone have any experience with how nimble the lenders are about finding and filing? Last question, if they have a judgment, they also have to take steps to seize the assets. Because my assets are real property, is it easier to find and/or seize them? If there is a judgment out there and I sell another property, what is the mechanism (if any) that automatically requires those proceeds pay off the judgment? Any thoughts?
It will be the lender's discretion as to when he will be filing the judgment for the deficiency. Also if property in one country is foreclosed, it will not affect the property in other countries. However if you have properties in different states, then the lender can place liens on it if you do not pay the deficient amount.
The properties are in different counties in the state of Florida. What I understand is that the lender must file a certified copy of the judgment in each county that it wishes to exercise a claim. A. Is this correct? B. How aggressive are they? C. If a whole industry of collection agents is reinvigorated based on a model of car loan collections, what are their practices? What can I expect?
Hi Jack,
Yes, the lender can file a certified copy of the judgment in each county and try to exercise claims on them. It will vary from lender to lender whether they are interested in exercising their claims on properties in other counties or not.
If the lender feels that he will not be able to recover the debts from the borrower, then he sells the mortgage to a collection agency. The agents of this agency then try to collect the debts from the borrowers.
Yes, the lender can file a certified copy of the judgment in each county and try to exercise claims on them. It will vary from lender to lender whether they are interested in exercising their claims on properties in other counties or not.
If the lender feels that he will not be able to recover the debts from the borrower, then he sells the mortgage to a collection agency. The agents of this agency then try to collect the debts from the borrowers.