Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
johne - i think what you're suggesting is one of two things: either read the mortgage note or read the agreement that you sign with your pmi company. if i am right about this, here is my response:
the note that this particular borrower signed is a standard note, there is no special language in it with regard to the pmi company being able to sue at any point in time.
and, you probably know this already, but a borrower typically doesn't sign (or even see) any kind of agreement with a pmi company. in many cases, a borrower doesn't even know what company they're actually paying pmi to.
so, actually, there IS nothing in any of the mortgage documents i've read that indicated that this borrower could be sued by a pmi company.
the civil suit papers indicate that the pmi company is able to pursue the lawsuit b/c they paid on a loss claim that was greater than the deficiency balance owed on the home after the foreclosure sale, which seems to me to be a technicality of law.
that's why i'm trying to find out if this is legal or if it is an arguable technicality.
(btw, i worked in consumer real estate at one of charlotte's big bank's writing training teaching banking center associates how to sell mortgages...you'd think if anybody would have encountered the answer to this question, i would have. but i haven't.)
Well then my quick response to this then is : Since banking laws and insurance matter laws are held in the hands of the state I would look to a State Agency (Hot line, web site, consumer beefs, you know the drill) to answer the question.
Now I'm not saying this is easy but at least when you're finished you might be hearing it from the horse's mouth.
Good luck.
loves, i think most people (myself included) assume that by protecting the lender you are, in effect, protecting yourself. i don't want to speak for others, but my reasoning, at least, is this: a borrower pays thousands of dollars over the years in pmi payments for just such an eventuality as default on the loan. so when the borrower actually defaults, that person has already paid the money in advance to protect that potential debt.
in my mind, pmi works sort of like a pre-paid credit card. you put the money down in case of emergency, and in the event of emergency the money is removed. end of story.
further, the removal of that money HASN'T protected you as the borrower, it has protected the lender just as promised, because they have also SOLD your home. they've recouped ALL of their money, and you're out of everything you've worked for. you haven't been been protected by PMI, the lender (who was intended to be) has been.
also, if that pmi co has purchased reinsurance, they are going to be filing their own claims to recover their loss, which makes this a double recovery.
did that make sense?
i think most people don't expect to be sued by their pmi companies, to whom they've paid a lot of money over the years, nor should they expect that. if people knew they could be sued in this way, the growth rate of piggy back mortgages would soar. no one would ever agree to pay pmi again.
Johne, you know what, I did call the nc insurance commission, and you know what they told me: We're sorry, we can't answer legal questions. Call an atty.
Real estate attys say: WHO'S suing the borrower? Never heard of that before. You should call a foreclosure atty.
Foreclosure attys say: Is the borrower interested in bankruptcy? That would really be the only way we could help.
I say: I should have gone to law school, then I could answer this question my own self.
(Then again, I also say I should have gone to vet school b/c then I could solve all my doggy's problems my own self. And, let's face it, vet school would win!)
Kind of news to me.. I always thought of PMI as insurance, such as car insurance. If you don't wreck your car the insurance company is making money off you so be it, but if you do wreck your car, the insurance company pays for it and you don't reimburse them for the amount, though you may through higher premiums. It appears PMI is more Insurance for the Mortgage company that they have to pay to cover themselevs in case you default and then pass on the cost to you. So in essence its not your PMI, its the mortgage companies PMI that you are paying for.
If you are short of the payoff in a foreclosure, someone is going to come after you. With PMI, you are in essence insuring the lender. But, the remaining debt is then assigned to the insurer and they will come after you. By simply filing a judgement, they are insuring themselves of a future return on that investment for a long time (10 years in most states) in the case that the person hits the lottery or comes into a sum of money. Also, many lending institutions made you pay off your judgements prior to them granting a loan back when I was in banking.
2spyderman - I would agree with most of what you are saying. However, this particular borrower lost the home due to medical disability. The mortgage company knew the default was coming, and opted not to work with the borrower DESPITE the PMI company's request that their lenders work with borrowers in danger of default. Further, the atty representing the lender at foreclosure knew the borrower was out of work and would stay that way due to medical disability. So, what is actually likely to happen in this case is that this borrower will never own anything again.
The PMI company is actually throwing good money after bad in trying to collect, which is something else I don't understand.
2spyderman - I would agree with most of what you are saying. However, this particular borrower lost the home due to medical disability. The mortgage company knew the default was coming, and opted not to work with the borrower DESPITE the PMI company's request that their lenders work with borrowers in danger of default. Further, the atty representing the lender at foreclosure knew the borrower was out of work and would stay that way due to medical disability. So, what is actually likely to happen in this case is that this borrower will never own anything again.
The PMI company is actually throwing good money after bad in trying to collect, which is something else I don't understand.
This all makes perfect sense in today's "housing crisis" envirnoment. Mortgage company said from the get-go---look I'll give you the money BUT I want you to take out PMI because there's not a lot of equity here. So mortgage co. responds to "medical problem" with--"So? We're covered. PMI says well let's "bank" this money for futures. Why? because they "banking" a gazillion of them. For all I know (which I don't) they very well might consolidate them in bundles and SELL them. Hell, they sell everything else. Why not those loans.
BTW--I never had the experience of PMI but in doing some research after this post was made I saw some info thru Google search that advises when and how you can get RID of PMI. Those that have PMI might be interested. Easy to find on Google.
je
I bought my home in 2007 , i am headed towards foreclosure, i am paying 148.00
a month for private mortage insurance, can my bank chase come after me , and
file for a foreclosure deficiency in texas, if i just walk out.
I bought my home in 2007 , i am headed towards foreclosure, i am paying 148.00
a month for private mortage insurance, can my bank chase come after me , and
file for a foreclosure deficiency in texas, if i just walk out.
I bought my home in 2007 , i am headed towards foreclosure, i am paying 148.00
a month for private mortage insurance, can my bank chase come after me , and
file for a foreclosure deficiency in texas, if i just walk out.
You need to talk to an attorney.
"
In the case of foreclosure, lenders can pursue deficiencies in more than 30 states, including Florida, New York and Texas, according to the U.S. Foreclosure Network, an organization of mortgage law firms."
Mortgage lenders pursue homeowners even after foreclosure - Yahoo! Finance (http://finance.yahoo.com/news/Mortgage-lenders-pursue-cnnm-3107909798.html?x=0 - broken link)
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
And, let's face it, vet school would win!)
