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Foreclosure in 91001 : Real Estate Advice

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Sat Jun 12, 2010
Hannah Fliegel answered:
Hi S,
Your lien holder in second position is a recourse loan. This means that the lender does have recourse to go after you if you do not pay them. For example, they can remove their interest on the property and go after you personally. The can either take that ‘debt’ which is a commodity and sell it to a collection agency or a vulture fund. The collector can take that ‘debt’ obligation to court in effort to get a deficiency judgment against you. With a deficiency judgment that debt obligation is a better commodity and can be sold or traded. Once the court issues a deficiency judgment against you the creditor will then be able to garnish wages, go after assets, place liens on property etc. There is also a statute of limitations that you may want to consider because many folks think that they do not have assets but in 5 years you might and guess who is there waiting for you?
This is the reason that bankruptcy is so common with regard to foreclosure and real estate in general. You might be able to negotiate a settlement with the lender. For example, I owe you $50k how about taking $15k and we call it a day? Good luck!

Hannah Fliegel, FICO pro
The Credit Repair Expert
415-999-9348
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