2006-09-25 08:28:13 · 3 answers · asked by Anonymous in Business & Finance ➔ Other - Business & Finance
If the bank forecloses on your mortgage, they repossess your house. I expect in the next couple of years there will be a lot of houses repossessed. Yes. That will effect your credit rating. There is a bright side however. The repossession takes a great deal of time. And during that time you get to live in the house for free. The mortgage company, bank or other, does not get recourse to your other assets, only the house. The way housing values are falling, you many not want the house any longer anyway. And when the banks start dumping all the repossessions on the market, prices will drop even further.
2006-09-25 08:47:31 · answer #1 · answered by Anonymous · 0⤊ 0⤋
What do you mean "let it go back"? Doesnt really make any sense. My guess what you mean is- "what happens if you dont pay your mortgage"? Well, depending on the state you live in, you have so much time (varying from a few weeks to abotu a year from state to state) to get current on your payments, or the lender will forclose on you. They will then kick you out and sell your house at auction. And as you said, your credit will be really messed up.
2006-09-25 15:36:47 · answer #2 · answered by bmwdriver11 7 · 0⤊ 0⤋
It's just repossessed, BUT, if they re-sell it and the proceeds are far less than the mortgage, they may again look to you for the difference, including fees and expenses.
If they can't collect, at their choice, they can report the difference to the IRS as a debt written off. This could be considered income, just like a gift, with a tax liability.
Sometimes lenders do this and some not.
2006-09-25 15:42:32 · answer #3 · answered by ed 7 · 0⤊ 0⤋