Home Buying in 33012>Question Details

Sue, Home Buyer in 33012

If you are buying a house for primary residence but already have a house in your name, can they take the first house if you have to default on the 2nd

Asked by Sue, 33012 Wed Sep 14, 2011

The first house is paid for and not given as collateral for the 2nd. I haven't lived in the first house for 24 years, my mother lives there.

Help the community by answering this question:

Answers

6
Sure can. A local realtor here in Detroit did that. The first loan bank (the one she defaulted on) came knocking on her door and took the second house. She had borrowed the money for the second house from a friend. So now she owes money on a house she doesn't own
0 votes Thank Flag Link Tue Mar 5, 2013
No. Not unless you put it up for collateral. Can you remedy your default or do you just want to get rid of it? A short sale may work for you.
0 votes Thank Flag Link Mon Oct 17, 2011
Hi Sue,

This answer is No.. If you buy a new home and default on it then you will lose that home by way of foreclosure..

Your lender may inquiry about the first home but this is standard. It does not mean they will go after your moms home.

Just for you to know, you can homestead the new property and your mom can still homestead her home.

So, make sure you homestead the new home as this will be your primary residence.

Good luck,

Stephanie Leon
0 votes Thank Flag Link Fri Sep 23, 2011
My broker said she would explain that I haven't lived in the first house since 1987 and so this house would not be considered investment property. It's only in my name. My mother lives there and pays the taxes.
0 votes Thank Flag Link Thu Sep 15, 2011
The short answer is no. If you do not use the ownership of the first property to secure the second, then it is not at risk. I am speaking as a Broker in a Deed of Trust state. I agree with Sally, you should consult some other professionals.

I don't agree that the second home would be investment property...under the IRS rules you are allowed two residences...if you own the first house, free and clear, then the mortgage office might explain what you will need to buy house #2...but it will not be investment property...
0 votes Thank Flag Link Wed Sep 14, 2011
Sounds like you're getting way ahead of yourself. You should first consult an estate planner, or tax attorney or CPA. If you already own a home, and buying another, then one of them is going to be considered an investment property and has different tax implications.
0 votes Thank Flag Link Wed Sep 14, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer