My home is being foreclosed 9/24 in WA state my 2nd is with CitiMortgage they have turned me to a collection can that happen before foreclosure?

hi erickson,

it is mandatory for the second mortgage lender to wait till the foreclosure takes place and then charge off the mortgage. the lender can charge off the mortgage prior to your foreclosure.

thanks

After foreclosure if funds are not recovered, do they take legal action against the homeowner, garnish wages etc?

I am also curious about the above question. I am looking at the possibility of having to foreclose in the future, but I am extremely worried that if I do foreclose, the banks will be able to stick me with some type of bill.

clarification on this would be great.

just to clarify... when i say 'bill' i mean would i be held responsible for the remainder of the loan in the event of a foreclosure?

and are there any other fees i would be liable to pay if i foreclosed?

Hi Erickson/Aaron,

After a foreclosure, if the lender is unable to recover his dues, then he will able to file a deficiency judgment against the borrower and try to garnish his wages. However, if it's a non-recourse state, then the lender will not be able to come after the borrower for the dues. You won't have to pay any fees if you let the lender foreclose the property.

I understand, but does that pertain to the 2nd mortgage, and is WA state a non recourse state, which I think it is. But I'm concerned about the 2nd.
Thank you for your answers, they are helpful.

If my home goes to REO after auction, and enough is made off a sale will they take care of the 2nd mortgage?

@ adonis

do you happen to know if Arizona is a non-recourse state?

Sorry, I just discovered that AZ is in fact a non-recourse state. So does that mean that if I do end up foreclosing on my home the lender can not, under any circumstances, come after me for any fees?

Thanks again for your time.

To Erickson,

WA is a non-recourse state. However, in case of a junior lien, the lender can come after you for the balance dues. They can even file a deficiency judgment against you and try to recover the dues. If the foreclosure results into an excess amount, then you can use it to pay off your second mortgage lender.

To Aaron,

If you have only one mortgage on the property, then in a non-recourse state, the lender won't be able to come after you for any fees or deficient amount. He will only be able to recover the collateral.

Thanks,

Jerry

Thanks jerry.

I only asked because I have heard a few people around my workplace remark that after their home went into foreclosure, the bank was able to sell it for only a few thousand less than what was owed, so they weren't responsible for the remainder.

So it confused me on whether or not the lender could pursue any fees in the event of such a foreclosure. I don't have a second and I haven't taken out any equity (my mortgage is adjustable, but that's it lol). So I should be ok if i foreclose, correct?

Hi Aaron,

As I've mentioned earlier, if you're staying in a non-recourse state, the lender won't be able to come after you to recover the balance dues. However, if you're staying in a recourse state, then the lender will be able to come after you for collecting the balance amount. You should check out your state laws in order to determine whether or not you stay in a non-recourse state.

Thanks,

Jerry

Thanks again Jerry.

I'm in Arizona so I should be okay where fees are concerned in the event of a foreclosure.

I appreciate the help very much