One of my clients this past week owns a house worth about $350,000. He has a first mortgage with a $375,00 balance and a second mortgage owed to Bank of America with a balance of $200,000. The client has not paid either his first or second mortgage in over 20 months, and the first mortgage has just recently sued him for foreclosure. Continue reading
One of my clients this past week owns a house worth about $350,000. He has a first mortgage with a $375,00 balance and a second mortgage owed to Bank of America with a balance of $200,000. The client has not paid either his first or second mortgage in over 20 months, and the first mortgage has just recently sued him for foreclosure.
I have stated on this blog that I usually do not recommend that upside down homeowners invest time or effort in short selling their real estate. I do not think that short sales provide a significant advantages to the homeowner.
A homeowner who their homes to their mortgage company face costs and liability other than mortgage payments and possible deficiency judgments. In addition to mortgage payments the homeowner is liable for homeowner association dues and assessments that come due after the homeowner stops paying the mortgage but before the mortgage lender completes the foreclosure process. Continue reading
I have had several clients who resided in California and who had invested in second homes or investment property in Florida which properties had become “upside down” during the real estate recession. These clients had called me for information about Florida’s foreclosure process including the rules regarding personal deficiency judgments. They wanted to know if their mortgage lender could pursue a deficiency claim against them when their home state prohibited deficiency judgments.
Everyone knows the rule that, “if it looks too good to be true, it probably is.” And everyone also knows that there is an exception to every rule.
First mortgage deficiency judgments are the exception, but there are certain exceptions. One exception is when the homeowner purchased an unimproved lot in a property developed by the Ginn Development Company owned by Bobby Ginn. The Ginn projects include Bella Collina and Reunion Resort. These developments suffered terribly in the real estate recession. Clients have reported depreciation of between 75 and 90% . Ginn has been named in several private lawsuits.
I have written many blog posts about mortgage deficiency and strategic defaults. Most prior posts suggested that people who strategically default on a typical residential mortgage will escape deficiency liability and not suffer significant repercussions. There are exceptions; here’s one.
This is part two of a two-part post recounting parts of my conversation with an experienced attorney working for one of the state’s largest foreclosure law firms. The first installment was published on June 19, 2012. Here is a summary of the rest of our conversation:
I am very interest in how the opposition perceives the legal situations which involve my own clients. An example is the pervasive mortgage foreclosure and deficiency situation. I wonder what is in the minds of attorneys who pursue the mass of foreclosure actions on behalf of large banks. What do they see as the most effective defenses, and what frustrates them and their banking clients in the mortgage foreclosure process?