Borrower - Beware of possible recourse with that short sale or foreclosure.
Ever since short sales and foreclosures began several years ago, there has been a growing consensus of opinion that at some time banks and lenders were not going to continue to let the borrower “off the hook” for the money owed.
That time seems to have come according to this article written by Michael Pollick on Sunday June 19, 2011 in the Sarasota Herald Tribune. Homeowner & Condo Associations along with Banks are becoming proactive in recovering deficiency judgments for the money owed on short sales, foreclosures and association fees.
Visit the link below to view the complete article and read how this may effect you if you are going to be a short sale or a foreclosure.
If this may effect you, be sure to contact a real estate attorney to get legal advice before making any decisions.
Excerpts from Mr. Pollick’s article:When a lender sells a foreclosure home for less than the mortgage, the difference – or “deficiency”—is typically registered in the court proceedings as being owed by the original borrower, but it is seldom paid.
For the previous owner, (borrower) who thought they were done with an “investment Property” except for the bad credit rating, the garnishment can come as a rude shock.
“ I have seen a slow trickle of attempts to collect deficiency judgments on mortgages,” said Darren Soto, and Orlando attorney, Eventually, “ we will see a lot of banks selling these deficiency judgments to third party collection firms, and obviously those firms are going to be a lot more aggressive in collecting the money judgments."
Foreclosure fees haunt homeowner associations
By Michael Pollick
Three years into the foreclosure epidemic, desperate condominium and homeowner associations are now beginning to employ aggressive law firms and collection agencies in a new tactic aimed at recovering delinquent fees.
The debt collectors working for these associations are asking the courts to use more extreme measures. In a few cases, they have gotten judges to help them freeze and confiscate the bank account of a former owner.
Florida is gliding quietly into a new and potentially painful part of the boom-bust cycle, where stacked-up "deficiency judgments" for unpaid condo fees and unsatisfied mortgages could come back to haunt past owners. Many of them thought they had escaped further costs when they handed their home over to their lender.
When a lender sells a foreclosed home for less than the mortgage, the difference -- or "deficiency" -- is typically registered in the court proceedings as being owed by the original borrower, but it is seldom paid…….
To view the complete article by Michael Pollick please follow the link below;
Sarasota Herald Tribune article by Michael Pollick
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