Can an unpaid debt from a default judgment due to foreclosure be erased after a period of time, if so, how many years?

Asked by Ash, Hartford County, CT Tue Apr 6, 2010

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Catherine Kim Owens’ answer
Catherine Kim…, Agent, Hallandale, FL
Wed Apr 7, 2010
one can be pursued for deficiencies, both current and future, unless the borrower specifically asks to be released from the deficiencies. I have several short sale deals that are ready to close, but because the borrower is asking for release, the deals have been delayed, waiting for a response. It is always good to hire an attorney to request such releases; however, one can do it him/herself.
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Hannah Flieg…, Agent, Larkspur, CA
Wed Apr 7, 2010
Hi Ash,

It appears that the property was foreclosed through the mortgage and this would provide the lender with the collateral "property" and the "judgment" for the balance on the loan. This "judgment" is a commodity that the lender or collection agency can sell to a third party which is what I expect has happened by now.
With a judgment a debt collector, which is a collection agency or law office or original creditor can place liens on other properties you might have, garnish wages and they also have a statute of limitations, in your State I believe that it is 10 years. You may not have assets now but you might in a few years which is why many consumers such as yourself either work to settle the debt now or file a bk to shake the debt so that you do not have to look over your shoulder years from now as you might regroup and grow your net worth and acquire assets only to have a collector waiting for you.

Your homework is to confirm the statute of limitations in your State and also check the renewal of that Statute of limitations. Meaning is it 10 years and then can be extended another 10 years which would total 20 years. I have seen judgments like this on people's credit reports.

Good luck!

Hannah Fliegel
The Credit Repair Expert
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Bob Movin-On, , Hartford, CT
Wed Apr 7, 2010
No, As long as the person holding the judgment continues to try to collect you are liable. Many judgment holder eventually give up trying because it costs money to keep going to court. Many will sell the judgment to a company that buys judgments for pennies on a dollar if that happens you should be able to negotiate a much lower settlement.
The best way to combat judgments is have a personal financial statement prepared that shows you do not have anything to collect on showing the judgment holder they are chasing after an noncollectable debt.
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Maureen Cody, , Charleston, SC
Tue Apr 6, 2010
Dear Ash,

To find accurate answer to your question, you'll want to consult with a professional, such as your accountant, or credit counselor.

Best of luck,
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