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Ask C.Fortunato Your Own Question
C.Fortunato
C.Fortunato, Attorney
Category: Legal
Satisfied Customers: 8023
Experience:  Admitted NYS Bar, member ABA, NYSBA, NYCBA, QCBA, Licensed Real Estate Broker
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Currently I have home in the midst of a foreclosure(stopped

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Currently I have home in the midst of a foreclosure(stopped making payments in jan). My girlfriend and I bought another home before stopping the payments on the other home. What are the potential implications?

cfortunato :

Hi - my name is XXXXX XXXXX I'm a Real Estate and Consumer Protection attorney here to assist you.

cfortunato :

The fact that you and your girlfriend purchased another home before having stopped paying the mortgage for the home in foreclosure does not matter.

cfortunato :

However, the mortgagee can get a deficiency judgment for the balance of the mortgage after the house sells in a foreclosure sale. This judgment can be used to place a lien on your new home.

Customer:

What are my options. How would my filing for a bankruptcy impact the new home mortgage?

cfortunato :

If the new home mortgage is already in place, your Bankruptcy filing will not affect it.

cfortunato :

If you continue to pay that mortgage.

Customer:

Thanks for the information. I think I understand my options and the potential implications. Would you recommend filing for bankruptcy?

cfortunato :

How much equity does the new home have? (Equity = current market value minus the balance on the mortgage.)

Customer:

very little. It appraised for about what we paid for it. We have done some work to it, but not sure its significant enough to raise the value that much

cfortunato :

Last question - is the foreclosure process being conducted in court or out of court?

cfortunato :

In other words, is the foreclosure process a judicial proceeding?

cfortunato :

Or a non-judicial proceeding?

Customer:

As far as I know out of court, but not sure. I have had very little direct contact with the mortgage holders (first and second mortgage on other home). I recieved a notice from the primary mortgage holder indicating the process has gone to foreclosure.

cfortunato :

Thank you for your responses.

cfortunato :

If the foreclosure is being conducted out of court, the mortgage companies will not be able to get deficiency judgments for the balance of the mortgages.

cfortunato :

Which means there would be no need to file a Bankruptcy.

Customer:

So, its just a wait and see game?

cfortunato :

Yes.

cfortunato :

Once you find out whether the process is judicial or non-judicial, you will have plenty of time to file a Bankruptcy.

Customer:

I assume if it goes to court I will get some formal notification

Customer:

I just stopped making payments in january, so the foreclousure process is just starting

cfortunato :

Yes - the mortgage company must file a Complaint, which must be served on you and on your girlfriend.

Customer:

My girlfriends name isn't on the other house, but given its on this one she will be severed as well?

cfortunato :

No - I thought your girlfriend's name was on the mortgages for the first house also.

cfortunato :

If not, she will not be served notice of the foreclosure proceeding.

Customer:

no

cfortunato :

So, only you would have to be served if the mortgage company goes to court for the foreclosure proceeding.

Customer:

ok, thanks for your help! Very good info!

cfortunato :

You're welcome!

cfortunato :

And please have a pleasant day!

Customer:

thx! You do the same!

cfortunato :

Before you leave, please don't forget to provide a positive rating for my help.

cfortunato :

Thank you!

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