Foreclosure in 89123>Question Details

Lv89123, Both Buyer and Seller in 89123

I own a home with another person, (50/50-jtwrs). One has a mortgage, the other does not. Can the bank short sale or foreclose on a 1/2 interest prop?

Asked by Lv89123, 89123 Wed Dec 2, 2009

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Heather Peck’s answer
If there is a mortgage on the property, then the bank can foreclose. It doesn't matter the percentage and it doesn't matter that only 1 of 2 owners is on it. I'm assuming you became 1/2 owner with someone who already had a mortgage on the property with some equity.

Regardless, although the foreclosure or short sale won't hurt your credit because you're not on the loan, if the other person you own the house with loses it to foreclosure, the house will be gone. All of it, not just half. The mortgage is a lien on the property and if it doesn't get paid, the bank will take it back. I wish I had better news.

Let me know if I can help you with the short sale. I do a lot of them.

Heather Peck
Rosen & Company West
0 votes Thank Flag Link Thu Dec 3, 2009
I am quite surprised that the bank offered a mortgage on only 1/2 interest of the property. You better check the title. If this is the case you better be in a position to pay up or you are going to have a bank as a partner.
0 votes Thank Flag Link Thu Dec 3, 2009
The bank can foreclose on 1/2 interest but they would investigate title issues before completing the foreclosure. Most likely the person not on the mortgage even though they might be on title would loose there interest if the property is foreclosed. Of course a short sale would have both parties sign the contact and deed to transfer property because a short sale is a normal real estate transaction with the banks approval to payoff the loan short of total payoff.

Keith Manson
First Weber Group
Certified Distressed Property Expert
Metro Milwaukee
0 votes Thank Flag Link Thu Dec 3, 2009
Yes, the bank most certainly can foreclose on a property. If the loan is secured by the property, and the borrower is in default, then the Lien holder can initiate foreclosure proceedings with a notice of default.
0 votes Thank Flag Link Wed Dec 2, 2009
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