Want to buy house in NC before contingency contract expires. 1st house been on market since the begining. of April. If I buy the house in NC with own money what happens if I don't sell and foreclose on 1st house. If the bank gets what we owe on it, could we lose our house in NC? Would we lose that one too if we were making our payments on NC house? What could happen if anything to house in NC. I know our credit would be screwed up, but we would already have our other house in NC. Could anything happen to it? What are the foreclosure laws for MD?
2007-07-18 17:20:38 · 7 answers · asked by Teresa F 2 in Business & Finance ➔ Renting & Real Estate
You would not lose your home in North Carolina. If their is a deficiency in the home that may be foreclosed on, then they could sue you for the difference although this is not very common. Your credit will obviously be destroyed, you will have a hard time obtaining financing for just about anything for a few years (up to 7) and you will most likely receive a 1099C from your old lender. This 1099C will need to be claimed on your taxes for the upcoming tax year that it is issued in and treated as normal income. Therefore, if there was a deficiency of 50k, then you will receive a 1099c in the amount of 50k and you will be responsible to pay taxes on this when you are doing your taxes as if you had earned this. However, long story short your new home in NC will be fine. You may want to consider other alternatives to foreclosure though since that is a last resort. Try seeing if your lender will accept a short sale, defer payments for awhile to help you out to sell the home, etc... Good luck to you and see below for ways to avoid foreclosure.
2007-07-18 17:29:45 · answer #1 · answered by dzwreck 4 · 2⤊ 0⤋
Well, here's the thing. The lender on the 1st home only has rights to that home. Whether you own other homes doesn't matter to them because they have no interest/collateral in it. Now, for whatever reason you already seem like you're planning on this happening, which is not a good thing at all. Yes, your credit will definetly be screwed up - for a long time. And what will happen later down the line when you need a loan (car loan, credit card, HELOC, etc) and you have to explain why you had a foreclosure? The truth would be that you saw no reason to pay the mortgage because it hadn't sold and you already set yourself up with a new loan in NC so you could have cared less what happened to the loan.
If your home has been on the market for awhile and it's not selling then it easily could be over-priced and/or you're not offering any incentives to buyers, such as paying for their closing costs. Your much better offer waiting until you either selling the 1st home before you buy a home in NC or try renting out the 1st home, and just keep it.
2007-07-19 00:27:48 · answer #2 · answered by Anonymous · 2⤊ 0⤋
It won't necessarily be pretty. If you close on the second with NO mortgage (meaning you have 100% equity) and then let the first go to foreclosure, you're going to have ONE mightily irritated first lender. Once they discover your asset value, they will pull out all the stops available to them legally (and rightfully so) to recover any monies lost on the first property.
What you are doing here is trying to allow a foreclosure when you HAVE sufficient financial assets to properly handle your financial liability.
The legal reality is that they CAN take a judgment against you for any deficiency on the first property, and then use that judgment to place a lien against your second property.
Frankly, given what you are trying to do here, I hope like hell they DO proceed thusly.
2007-07-19 00:33:59 · answer #3 · answered by acermill 7 · 1⤊ 0⤋
http://www.realtytrac.com/education/noframes/foreclosurePro.html
http://www.foreclosure.com/statelaw_MD.html
Hope this helps you out and good luck to you. One thing you might consider is, RENTING your home that is for sale now, that will help make the payments or advertise in paper as home being for sale by Land Contract, have someone live there for 1 year, make payment by check, fill out a land contract and file the land contract at your local court house ( you can get free land contracts on line, just type in " free land contract") In one year they can "refinance" the property, you get paid and they have a mortgage. This is just a "quick version of how a land contract works". You can also have an attorney fill it out for you. Do a www search on land contracts so you are well informed.
2007-07-19 00:32:52 · answer #4 · answered by W. E 5 · 1⤊ 0⤋
If you buy the NC home, and foreclose on the first, your credit will be harmed significantly...but you can still keep and pay for the NC house...that's a totally seperate transaction.
2007-07-19 00:28:34 · answer #5 · answered by blaxjulian 1 · 1⤊ 1⤋
I say auction of the first house and you have a good chance of getting or close too getting what you are looking to get out of it.Then you dodn't have to worry about your credit been messed up because it will be on there for a while.Anthe house is sold and out of your hair.
2007-07-19 00:30:05 · answer #6 · answered by john d 3 · 0⤊ 1⤋
look into a bridge loan
2007-07-19 00:28:36 · answer #7 · answered by Dana Blanco 4 · 0⤊ 1⤋