REO Specialists llc
914 S Burdick St
Kalamazoo MI 49001
Typically, when your lender forecloses, they bid on your house at the sheriff's sale. If their bid is for the entire remaining principal plus late fees, attorney costs, etc. this is called a "full bid". When their bid is a full bid, it means that they have written off the entire amount as bad debt and they can not come after you for anything in the future.
However, today about 30% of the time, a lender will bid less than what is owed. This is called an "underbid". When the lender bids less, it keeps the door open for them to come after you in the future to collect the difference between what they realize out of the sale of the house and what you owe.
If there is a second mortgage with a different lender or an equity line, those lenders can still pursue you in the future. So, you can see there are many different scenarios.
After the foreclosure sale, you still have a redemption period where you can sell the house on a short sale. During the short sale negotiations, it is possible to get the lenders to waive all deficiency which would mean that they would not come after you in the future.
If you want more information specific to your circumstances, call me and we can discuss your options.
Keller Williams Realty
Every bank is different and legally they do have the right to come after you to collect any money that is owed. They may also 1099 you for the difference of what is owed on the home and what they eventually sell it for.
Besides that, a foreclosure remains on your credit longer than a short sale would. Why not consider a Short Sale? A short sale may be your best option.
Why not come in and talk to our staff about Short Selling your home? We are the number one Short Sale company in Michigan and we can definitely help you. Don't just think foreclosure is your only option.
My contact information is below, feel free to contact me.