[mango23]

There will no doubt the collectors and lawyers who will make this a specialty and come after you.
People who walked may have a second shoe that will fall on them and it could be a big one for many.


Housing crisis: Lenders expected to sue homeowners for repayment of mortgage debt - South Florida Sun-Sentinel.com

[Sunny-Days-in-Florida]

Originally Posted by mango23

There will no doubt the collectors and lawyers who will make this a specialty and come after you.
People who walked may have a second shoe that will fall on them and it could be a big one for many.


Housing crisis: Lenders expected to sue homeowners for repayment of mortgage debt - South Florida Sun-Sentinel.com

This is already well known. Many states laws protect the homeowners from being sued for the remaining balance.

As you know it cost tons of money to go after the former homeowners and unless it is a ton of money in most cases they are not coming after the former owners.

There is a website that shows that most banks will not even attempt it unless it is more then 50k.

It also stated that the cases are so backlogged that it could take years before they even get to them, and if the states collection statutes expire they cannot collect it anyway.

Smaller banks and lenders do not have the money attorney staffs to even go after the people.

Most will likely get away with owing the money, only a few will get nailed for the balance.

Once such case here in Ohio the previous owner beat the lender in court because they proved the lender hired an appraiser and told them what to appraise the property at, higher then it was worth for a home equity loan.
The lender lost the case and had to pay all court cost, the previous owners attorney fees etc. The judge also ordered the negative removed from the credit report.

Many lenders had fake appraisals done like this and if you are one of those people who had this done you could beat them at this.

I am not for people foreclosing unless something drastic happened in your life, so do not get me wrong on this. But with lenders like the above they got what they deserved for handing out equity money on false information.

[mango23]

Originally Posted by Sunny-Days90

This is already well known. Many states laws protect the homeowners from being sued for the remaining balance.

As you know it cost tons of money to go after the former homeowners and unless it is a ton of money in most cases they are not coming after the former owners.

There is a website that shows that most banks will not even attempt it unless it is more then 50k.

It also stated that the cases are so backlogged that it could take years before they even get to them, and if the states collection statutes expire they cannot collect it anyway.

Smaller banks and lenders do not have the money attorney staffs to even go after the people.

Most will likely get away with owing the money, only a few will get nailed for the balance.

Once such case here in Ohio the previous owner beat the lender in court because they proved the lender hired an appraiser and told them what to appraise the property at, higher then it was worth for a home equity loan.
The lender lost the case and had to pay all court cost, the previous owners attorney fees etc. The judge also ordered the negative removed from the credit report.

Many lenders had fake appraisals done like this and if you are one of those people who had this done you could beat them at this.

I am not for people foreclosing unless something drastic happened in your life, so do not get me wrong on this. But with lenders like the above they got what they deserved for handing out equity money on false information.

The banks don't need to spend a cent. Collectors go after them on even the slim chance they collect, that is their business.

[Lilybeans]

A judgment is good for twenty years in Florida.

[annerk]

I don't understand why the IRS doesn't go after them to tax them for a capital gain if they took equity out of their home and then foreclosed or walked away. Seems that those of us who are doing the right thing are going to end up being punished with higher taxes and borrowing costs.

[Sunny-Days-in-Florida]

Originally Posted by annerk

I don't understand why the IRS doesn't go after them to tax them for a capital gain if they took equity out of their home and then foreclosed or walked away. Seems that those of us who are doing the right thing are going to end up being punished with higher taxes and borrowing costs.

Those of us who have done the right thing are going to pay for it in the end. Someone will have to pick up the slack and it will be us.

[Sunny-Days-in-Florida]

Originally Posted by mango23

The banks don't need to spend a cent. Collectors go after them on even the slim chance they collect, that is their business.

If they sell the debt to the collector yes, but even the collector will have huge cost in a lawsuit if they file one.

I agree, in some cases collectors will just not file a lawsuit and will use their other means to try and collect but in most cases those who did walk away wont have a dime to collect.

Banks have to spend tons of money. On the upkeep, clean up, insurance etc. Once the former owner walks the expenses for the banks starts.

Do not get me wrong, I am not for the people who walk away but I do know a high percentage of banks, collectors, bad debt lawyers wont collect a dime.

[Sunny-Days-in-Florida]

Originally Posted by Lilybeans

A judgment is good for twenty years in Florida.

Wow, I have not read the Florida statute but it is 20 years for real on real estate loans?

[johnrex62]

Originally Posted by annerk

I don't understand why the IRS doesn't go after them to tax them for a capital gain if they took equity out of their home and then foreclosed or walked away. Seems that those of us who are doing the right thing are going to end up being punished with higher taxes and borrowing costs.

I expect they will. During an audit a couple years ago, I overheard another auditor inform a couple that since they had declared bankruptcy and had a portion of their mortgage had been forgiven as a result of the restructuring, that forgiven portion was now considered taxable income and they owed the tax on that 60K plus interest and penalties.

[Lilybeans]

Originally Posted by Sunny-Days90

Wow, I have not read the Florida statute but it is 20 years for real on real estate loans?

20 years on a judgment.