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Why won't bank foreclose if someone is living there even when payments are late?

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    Why won't bank foreclose if someone is living there even when payments are late?

    My sister purchased a home with her now ex boyfriend in 2004. She moved out in June 2008. He still lives there. We are in Missouri. The mortgage was obtained from Countrywide Home Loans.

    Since she moved out he has missed numerous payments. He stopped paying just after she moved out. He got about three or four months behind. She was getting email notices of this. She finally called his aunt and his aunt caught up the payments.

    Sometime in the last year or so Countrywide sold their loan to Bank of America. I'm not sure how she figured that out but she is still getting email notices so I'm assuming that is how she figured it out.

    In recent months the ex boyfriend has been late again. He was apparently about four months late and she started getting calls on her cell phone number that is not even in her name. She doesn't even know how they got the number because she doesn't have it listed on any of her credit cards. He did, however, according to an email she received, make a payment on July 3 although it doesn't say how much but I doubt he caught everything up. She said she got a call as late as today so I assume he didn't.

    The bank is threatening foreclosure. She told them, "Go ahead," I don't live there anymore and don't care what happens." (He's already ruined her credit anyway with the mortgage and by running up a cell phone bill.) I'm guessing he got a foreclosure notice which is why he made the payment. She won't (and really can't) kick him out since he is on the mortgage too. In addition he has threatened that if she took the house he would burn it down.

    The bank said they cannot foreclose as long as he is still living there. I don't understand why not if he is not keeping up with payments. My husband and I also had a loan through Countrywide (before Bank of America starting buying their loans). They foreclosed on our house. However, by the time the Sheriff's sale occurred we were out of the house but we got the notices before we moved. This was in the fall of 2008.

    Our cousin stopped paying on her house in December 2008 (according to my sister). They filed bankruptcy (not sure when that was filed). As of early June 2010 they were still living there and hadn't been foreclosed on. They have since moved out though.

    Are banks taking longer to foreclose due to the amount they are having to do? Are they giving people longer times to pay their mortgage due to the poor economy? Or is there really some rule that if the owners are still living there they can't foreclose and evict them? Or better yet, evict them and then foreclose?

    #2
    Does anyone have any suggestions? Please help. My sister works overnights and sleeps days and she is not able to even sleep due to the number of phone calls.

    PLEASE HELP!!!!!!!!!!!!!!!!!!!!!!

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      #3
      Originally posted by ccaplinger View Post
      Does anyone have any suggestions? Please help. My sister works overnights and sleeps days and she is not able to even sleep due to the number of phone calls.

      PLEASE HELP!!!!!!!!!!!!!!!!!!!!!!
      Foreclosure rates vary tremendously depending upon the area of the country and the lender. There are thousands and thousands of houses with mortgages above $300k that are not being foreclosed or if they are foreclosed, they are not being put on the market because nothing is selling. In some areas lenders are being more aggressive about foreclosure. Foreclosures (judicial) can cost a lender/servicer $50k if you add in the court costs, taxes, insurance, sheriffs fees .... etc. Can your sister and ex get together and pool resources and hire an attorney for advice? Call the lender and ask about status. List the property for sale. Tell them you want to give it back in a deed-in-lieu, but all ideas need to be discussed with someone who is very knowledgeable about the process so you cover all bases.

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        #4
        Originally posted by ccaplinger View Post
        Does anyone have any suggestions? Please help. My sister works overnights and sleeps days and she is not able to even sleep due to the number of phone calls.
        HAve your sister turn off the phone.

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          #5
          When payments are not made the mortgagee(s) are in breach of contract. Have your sister and her ex pull out the mortgage papers they signed at settlement. They allowed the lender to do quite a bit if they fail to keep their end of the conract. Since your sister and her ex are not married, it wold be to her benefit to get a consultation with a real estate or family law lawyer to find out what she can do because eventually the bank will foreclose on that house and she needs ot know what to do when it does as her name is on the mortgage. All she is doing rigiht now is enabling her ex and getting you involved in ther personal drama. If payments are stopped the house will go away eventually - simple as that. What to do in the interim? See a lawyer as to the joint property situation and how to handle it.
          _________________________________________
          Filed 5 Year Chapter 13: April 2002
          Early Buy-Out: April 2006
          Discharge: August 2006

          "A credit card is a snake in your pocket"

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