Foreclosure court costs?

[Anewpage]

My mortgage, along with other debts were included in Chapter 7, closed & discharged. I am still in the house and have been served NOD.

I thought I understood that I have no financial liability for the home, but a realtor was really trying to convince me to list with her for a potential short sale. She tells me that I will be liable for court costs and that a short sale would be much kinder to my credit than foreclosure...Is there any truth to that, or is she just a salesperson?

Thanks!

[despritfreya]

I thought I understood that I have no financial liability for the home, but a realtor was really trying to convince me to list with her for a potential short sale. She tells me that I will be liable for court costs. . .

Ask her what law school she went to.

If you did not reaffirm you have NO financial exposure if and when the lender forecloses.

She tells me. . .that a short sale would be much kinder to my credit than foreclosure...Is there any truth to that, or is she just a salesperson?

Doubt it. Your CR is screwed up anyway so, even if this were true. . . who cares?

Bottom line. . . the realtor is the only one who benefits from a short sale especially if you have already discharged the debt. She is trying to make a commission. Just walk away. You don't need the aggravation of trying to sell something if no $$ is going to end up in your pocket.

Des.

[Anewpage]

Thanks Des for the reply.
That is exactly what I thought ....but the realtor had me a little worried.

[tobee43]

des, of course, is giving you the most excellent advise in reference to this situation.

however, what gets me about your thread is that darn realtor, what nerve, and what a low life.

and even IF you did rec a 1009a on any "gain"...one could just prove their insolvency at the time and there is no gain to report. but i would walk as quickly to the door and shut it hard behind me with any realtor telling you such garbage.

best of luck to you!!

[ryan]

From what I have seen, almost every realtor is predisposed to talk the short sale pitch...even if it would serve no purpose, as in your case. I had one realtor tell me last year that a successful SS would bring my credit back to 'normal', whatever that is!

[Anewpage]

I wonder if the Realtor really "knows", or if she is just babbling what she thinks she knows......
And when I think about it, a short sale would be worse in the long run because there would be a potential tax liability?

[despritfreya]

. . . a short sale would be worse in the long run because there would be a potential tax liability?

Not an issue since you discharged the debt in your Chapter 7.

Des.

[Anewpage]

Not an issue since you discharged the debt in your Chapter 7.

Des.

Thanks Again, Des.
That was a very logical answer! And makes perfect sense now!

Thanks!

[Anewpage]

From what I have seen, almost every realtor is predisposed to talk the short sale pitch...even if it would serve no purpose, as in your case. I had one realtor tell me last year that a successful SS would bring my credit back to 'normal', whatever that is!

Not sure I want my credit back to "normal"....Normal was lots of credit cards with lots of balances!
I am liking this not owing anyone kind of life!!!

[Dorsey]

Despite not being liable for the balance of the mortgage, be aware that as long as you "possess" the house (whether you have a loan on it or not), you are liable for homeowner association fees (if any) in most states. Based on what I read here, this catches people by surprise. The only portion of the homeowner association fees that are extinguished are those incurred prior to filing. After that home owner association fees are the possessor's responsibility even though the bank may technically own your house and is able to take it from you at any time. This is the case because most state law stipulates that "possession" is the determining factor in figuring out who owes monies to the association.

[tobee43]

Despite not being liable for the balance of the mortgage, be aware that as long as you "possess" the house (whether you have a loan on it or not), you are liable for homeowner association fees (if any) in most states. Based on what I read here, this catches people by surprise. The only portion of the homeowner association fees that are extinguished are those incurred prior to filing. After that home owner association fees are the possessor's responsibility even though the bank may technically own your house and is able to take it from you at any time. This is the case because most state law stipulates that "possession" is the determining factor in figuring out who owes monies to the association.

correct, and unfortunately for many that belong to HOA's. i know the house we surrendered was not involved in an HOA...now we have one and are one the HOA board, the way it's handled here, is a lien is put on the house for any past dues and when resold the lien needs to be lifted. most banks have been passing the costs on to the "new" owners. at least here.

[CCCrazy]

I'm confused...so I "possess" - ie. own - my home as long as my name is on the Note? (not sure what legal term i'm looking for to descibe this piece of paper). So hypothetically, if I vacate after the Sheriff's Sale and the bank still leaves the home in my name - am I liable for the HOA fees? can the HOA come after me for those fees, or will they just put a lien on the house and I don't have to worry about it?

[Dorsey]

No...possess does not mean own in the sense that you legal control of the house. Upon discharge the note or loan no longer exist. But you are on the title. Until the bank transfers the title you possess the property. The unfortunate reality is that if the bank drags its feet for 6 months before auctioning the property, you will be liable for the 6 months of HOA fees.

[HHM]

Once the sheriff sale takes place, your name comes off regardless. Once the property is "foreclosed" (meaning, a sale date has come and went), you no longer OWN the home. In most circumstances, the bank takes ownership and the property becomes a REO (real estate owned by the bank).

Its the time leading up to foreclosure that is the issue. If the homeowner files BK before the foreclosure is final (i.e. the foreclosure sale date), then any HOA dues that come due after the date of the BK filing, along with other misc bills, i.e. water, prop. tax, etc, are still technically the responsibility of the homeowner. Once the home is foreclosed, all those bills must be paid by the bank. So, the homeowner is still responsible (but not liable) because the homeowner is the deeded owner of the property (until the property forecloses). Keep in mind, these sorts of bills, HOA, water, property taxes, are attached to the property. Once the property changes hands, the new owner (in this case the bank), becomes responsible for the dues.

[tobee43]

Once the sheriff sale takes place, your name comes off regardless. Once the property is "foreclosed" (meaning, a sale date has come and went), you no longer OWN the home. In most circumstances, the bank takes ownership and the property becomes a REO (real estate owned by the bank).

Its the time leading up to foreclosure that is the issue. If the homeowner files BK before the foreclosure is final (i.e. the foreclosure sale date), then any HOA dues that come due after the date of the BK filing, along with other misc bills, i.e. water, prop. tax, etc, are still technically the responsibility of the homeowner. Once the home is foreclosed, all those bills must be paid by the bank. So, the homeowner is still responsible (but not liable) because the homeowner is the deeded owner of the property (until the property forecloses). Keep in mind, these sorts of bills, HOA, water, property taxes, are attached to the property. Once the property changes hands, the new owner (in this case the bank), becomes responsible for the dues.

ahhhhhhhh so perfectly stated...couldn't have said it better myself...LOL!!!!!!!!!