2007-08-01 11:36:21 · 5 answers · asked by Ceci 1 in Business & Finance ➔ Credit
This is a Real Estate Loan with zero equity where the loans are now higher than the value of the home in California.
Consequences= to the holder of the mortgage as far as future credit and legal obligations.
2007-08-01 11:51:23 · update #1
The bank will take the real estate that the loan is against....
just like a reposession of a car.
2007-08-01 11:40:28 · answer #1 · answered by terje_treff 6 · 0⤊ 0⤋
One word- Foreclosure
The bank then put your house on auction. For instance, if your house is worth $300.000 they sell to the highest bit sometimes it's only 200.000, by then you have to pay the attorney fee, the guy who's in charge the foreclosure, the adversities that the lawyer puts the house on sale etc... when it all set and done, you probably get a very little of the money back not to mention ruining your credit.
I have learned a huge lesson today from my lawyer just because I refused to pay my condo association the repair that I've never authorized. Their lawyer threats to put a lien on my condo. After I paid for the repair, now they want $1100 lawyer fee and if I don't pay, they will put a lien against my condo. This has nothing to do with my mortgage payment which I've never been late. If this is a condo association can do to me, imagine what the bank can do to you and your house if you default on your payment.
It's not worth it if you defaulting the loan. Try to sell it first, pay off the bank and move into an apartment.
2007-08-01 11:43:52 · answer #2 · answered by Connie 3 · 0⤊ 0⤋
It is serious ! mortgage and credit cards are installment accounts and even 60 & 90 days past due cause severe damage to your credit score it will stay on your credit for 7 years after paid. If you can ,sell !,if not bankrupcy will be just as bad but you save lots of money on written off interest and fees and get to keep your property. Talk to a professional
credit counselor or bankrupsy lawyer. If they repo your house they liquidate it to bidders and you still owe the balance of what they don't get.
2007-08-01 11:51:17 · answer #3 · answered by mike t 1 · 0⤊ 0⤋
In California, most loans are written such that they will not come after you for the deficiency amount. However, they will report the shortfall to you on a 1099, causing you to claim the shortfall as income you received.
Add to the fact that your credit score will drop to the 500 levels for some time to come.
2007-08-01 12:09:15 · answer #4 · answered by acermill 7 · 0⤊ 0⤋
1. You lose your home.
2. Your credit is trashed.
3. You may have to make up any of the lender's losses.
4. You may have to pay taxes on any forgiven debt if #3 does not apply.
2007-08-01 11:41:29 · answer #5 · answered by Bostonian In MO 7 · 1⤊ 0⤋