What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage?

3 responses to What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage?

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  kemperk

  Comment on What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage? (December 14th, 2010 at 04:31)

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  excluding unique components to your loan or your state,
  if a property goes into foreclosure, the law is simple; the 2nd note holder must buy
  out the first to keep his “rights.” if he does not, only the first mortgage survives an
  auction sale.

  [once the 2nd is wiped away, that debt cannot be revived unless someone naively
  offers to repay it .......later]

  What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage?

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  Ryan M

  Comment on What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage? (December 16th, 2010 at 01:48)

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  It depends if you live in a recourse state or a non-recourse state. Recourse means that they can sue you in civil court. 2nd mortgages are pretty much ALWAYS recourse loans…even in non-recourse states. Even if you live in a non-recourse state, the amount of money that you stiffed the bank for is considered income and the bank will issue you a 1099 for that. Some people are hundreds of thousands of dollars underwater. How would you like to pay the taxes on that? Next time, buy a house you can actually afford. Rates are at all time lows and you STILL cannot afford your house payments.

  What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage?

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  golferwhoworks

  Comment on What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage? (December 18th, 2010 at 14:18)

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  The laws of your state come into play. If you are in a recourse state then both note holders can come after any balances owed after you.
  Now almost every state allows and second lien holders to get their money owed after foreclosure.

  What determines if the mortgage company will come after you if you walk away from a 80/20 mortgage?