What happens to the owner of investment properties that have to let them go into foreclosure in Michigan?
I'm not talking about a deadbeat landlord, but an honest person who is upside down in several homes because they are worth substantially less today than what is owed on them, thus no equity. And the taxes and other expenses continually increase while rents decrease, thus not enough income to cover the mortgage payments, taxes, and insurance not to mention any repairs that may come up. This is the only income for this person. By the way, if you think all landlords are greedy and rich, please do reply.
Can the mortgage companies go after her personal property if she has to let any of them go back to the bank? Are investment properties (non-owner occupied) in Michigan treated differently than owner-occupied foreclosures? If so, how?
FYI: MANY landlords are in this boat, but cannot get any of the mortgage payback considerations to avoid foreclosure that are offered to owner-occupied mortgage holders. This means that renters are losing their homes too, including those renting to own!
I would advise you seek legal counsel to represent you and answer your legal questions. We are real estate professionals, and can not give legal advice.
That said, a foreclosure is a foreclosure whether on a primary residence or an investment property / second home. A deficiency judgement can still be issued and collected on. If you are upside down and can prove hardship, I advise you work with a professional on a short sale. If you would like the name of someone in your area, I would be happy to provide. Just email me at Derek@DoorToDreams.com, or contact me through my Trulia profile.
Thanks, and best wishes to you.
Derek Bauer, Associate Broker
Real Estate One
IF the only security for the note is the mortgage on each property..the banks are limited to that recourse--meaning they can foreclose, but personal properties are outside the banks reach..but it all goes to the terms of the loans/agreements on each parcel.
No question tons of property owners, investor and owner occupant are in this position..I get two to three calls a week from decent hardworking folks who've had the rug pulled out from under them.
Keep in mind if you're really concerned get a true legal opinion..
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Fair Housing and Equal Opportunity