can they put you in jail or do you just walk away do they sue you i got in a bad loan like everyone else what a suprise
2007-10-23 09:08:15 · 2 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
No jail. Usually, you have a right to redeem the house, which you probably cannot do, because if you could, you would not have defaulted on the mortgage, right?. They accelerate the note and call it due, sell the house at auction, and sue you for the deficiancy, if any, plus costs. In the meantime, they tell you politely to get out of the house.
2007-10-23 09:17:16 · answer #1 · answered by Anonymous · 0⤊ 0⤋
You won't go to jail, but you don't just walk away either. The lender will repossess your house because of non-payment, and you may find yourself responsible for the difference between what the house sold for after foreclosure and what you owed on the mortgage, plus foreclosure costs.
Another possibility is that they won't attempt to collect this shortfall, but will issue a Federal Form 1099 for the amount of this shortfall, causing you to claim the shortfall as income when you file income taxes.
As far as the 'bad loan' comment goes, it's the borrower's responsibility to know the nature of the financial commitment they are signing. There are no bad loans. There are only borrowers who didn't take the time to read what they were signing.
2007-10-23 09:24:06 · answer #2 · answered by acermill 7 · 0⤊ 0⤋