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Richard
Richard, Attorney
Category: Legal
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Experience:  Attorney with 29 years of experience.
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I recently divorced. And I moved in a new house which paid

Customer Question

I recently divorced. And I moved in a new house which paid 100% in cash by my parents.
My old house ( EX and I joint account) has been in Market . We stop payment the mortgage for 3 months. We expect the house sold in short sale.

If our old house is foreclosure, what will happen?
Will we be liability for the shortfall?
Will it possible Mortgage Bank come after my new property?


My old house is in Dupage county, IL.
My new house which was purchased after divorce in Kane county, IL.
Submitted: 5 years ago.
Category: Legal
Expert:  Richard replied 5 years ago.

Good morning. Unfortunately, Illinois is a deficiency state and does not have a favorable homestead exemption statute. So, the lender does have the right to pursue you for a deficiency judgment and you are liable for the shortfall. Your new property is only protected up to $15,000 in equity. You might want to give your parents a promissory note for the amount paid and a deed of trust to secure that note. That will eliminate the equity in your house. Then, when all this blows over, your parents can then forgive the note as a gift.

 

 

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The information given here is not legal advice. As all states have different intricacies in their laws, the information given is general only. This communication does not establish an attorney-client relationship with you. I hope this answer has been helpful to you.

 

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