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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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Tere is high lien judgment debt on my primary home and If I

Resolved Question:

Tere is high lien judgment debt on my primary home and If I let it forclose by not paying the mortgage payments. Will the lien judgment debt creditors get paid if there is high equtiy?
Submitted: 1 year ago.
Category: Legal
Expert:  C.Fortunato replied 1 year ago.

C.Fortunato :

 


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

C.Fortunato :

If you stop paying the mortgage - so that your home forecloses - the mortgage company will be paid first.

C.Fortunato :

If there are no other liens on your home, the judgment holder you asked about will get whatever is left over after the house is sold in a foreclosure sale.

C.Fortunato :

(If the mortgage company and the judgment holder are both paid in full, and if there is still anything left over, the amount left over would belong to you.)

Customer:

if there is a lien judgment lien debt amount 300,000 and the home market value is 1.5mill. will the home get sold for about the market value? reason I'm asking is that when there is a lien on the home, it will be sold for significantly low price. or the mortgage bank will negoticate with the judgment lien creditor to remove it when they sell it?

C.Fortunato :

What is the balance owed for the mortgage?

Customer:

1.1mill

C.Fortunato :

So the equity is $400,000.

Customer:

if it's sold at market value at normal housing market meaning no auction I guess.

C.Fortunato :

The mortgage company does not care about the judgment holder, and does not have to negotiate with the judgment holder.

Customer:

what does that mean? the mortgage company will sell the home to just cover their lone balance

Customer:

?

C.Fortunato :

If you stop paying the mortgage, the mortgage company can sell the house at auction to the highest bidder.

C.Fortunato :

The mortgage company can also bid, and this is what they often do if there are no bidders, of if the bids are not high enough.

Customer:

what if the house is not sold at auction? will the bank buy it them selve? which I heard it won't get sold at auction if the price is high over 1mill. usually low price ones get sold at auction I heard.

C.Fortunato :

Yes - the bank can also bid on the property.

C.Fortunato :

There have been many cases where the bank has purchased a property for a minimal amount.

Customer:

if the bank purchased my home themselves to only cover the lone balance, what happnes to the judgment lien? will they be removed or still on it?

C.Fortunato :

The judgment lien gets removed.

C.Fortunato :

This is because the mortgage lien is superior to the judgment lien.

Customer:

Do the mortgage lone banks purchase the home in most cases if it doesn't get sold at auction? so they can sell it at public market at higher price?

C.Fortunato :

That depends on whether they think the house can be sold right away at a substantially higher price - as they do not want to own any homes for an extended period.

C.Fortunato :

So, in areas where the housing market is brisk - such as thriving major cities - a bank will be more likely to purchase a house in a foreclosure auction than in an area where the housing market is depressed .

Customer:

then what's going to happen if the home doesn't get sold at the auction?

C.Fortunato :

The bank will re-schedule the auction - often for 6 months after the first one.

Customer:

what if it doen'st sell at later auctions?

C.Fortunato :

That also happens often, and that is the reason there are many who are still in their homes years after they have stopped paying the mortgage.

Customer:

then how will they sell my home if that happens?

C.Fortunato :

If they want to sell your home, they have to first purchase it at an auction.

C.Fortunato :

Or sell it at an auction.

C.Fortunato :

Otherwise, the house does not get sold.

C.Fortunato :

If they want to sell your home, they have to first purchase it at an auction.






Or sell it at an auction.







Otherwise, the house does not get sold.



Customer:

thank you for your answer. I kept trying to rate you but the button doen't work?

C.Fortunato :

You're welcome!

C.Fortunato :

You should be able to provide a rating now.

C.Fortunato :

Thank you!

Customer:

Also I have another question. When you file bankruptcy, my primary home can be sold by judge's order if there is high-equtiy. Will I recieved $75,000(homestead examption) before judgment debt lien on the home get paid?

C.Fortunato :

If you file a Bankruptcy, you get paid the homestead exemption after the mortgage company gets paid, and before the judgment holder gets paid.

C.Fortunato :

Also, if you file a Bankruptcy, that can discharge the judgment, so the judgment holder can no longer try to collect it.

C.Fortunato, Attorney
Category: Legal
Satisfied Customers: 8023
Experience: Admitted NYS Bar, member ABA, NYSBA, NYCBA, QCBA, Licensed Real Estate Broker
C.Fortunato and 19 other Legal Specialists are ready to help you
Customer: replied 1 year ago.

when the home get sold in bankruptcy, will it get only sold at auction?

Expert:  C.Fortunato replied 1 year ago.
If you file a Bankruptcy, the Bankruptcy trustee must sell your house for as much as it can be sold for (no auction) - within a reasonable amount of time (up to a year or so). And it must be sold for at least enough to pay the mortgage in full. If the house cannot be sold for enough to pay the mortgage in full, and also for enough to give you your homestead exemption amount, the trustee will not bother to sell your house.
In this event, you will be able to keep the house, and you can have the judgment lien removed along with the discharge of the judgment, but you cannot have the mortgage lien removed.
C.Fortunato, Attorney
Category: Legal
Satisfied Customers: 8023
Experience: Admitted NYS Bar, member ABA, NYSBA, NYCBA, QCBA, Licensed Real Estate Broker
C.Fortunato and 19 other Legal Specialists are ready to help you
Customer: replied 1 year ago.

I have a 300,000 judgment lien on my primary home. loan balance is 1.1mill and the current market value is 1.5mill if sold at normal housing market. can you advice what to do to resolve the 300,000 judgment lien issue?

Expert:  C.Fortunato replied 1 year ago.
What is the basis of the judgment? (What is the reason for the judgment?)
Customer: replied 1 year ago.

non payment and fraud but it wasn't fruad but I didn't fight the case so I got the fraud charge.


 

Expert:  C.Fortunato replied 1 year ago.
Unfortunately, fraud is one of the 19 types of debt that cannot be discharged in a Bankruptcy. So, filing a Bankruptcy cannot help with that judgment.
And, as I explained, allowing the house to foreclose is also unlikely to help.
Assuming that you do not care if you keep the house - since you seemed willing to allow it to foreclose - perhaps the solution would be to sell the house for enough to pay the mortgage and also the judgment. (But before paying the judgment, you may want to try to negotiate a lower total payment as satisfaction of the judgment, as judgment holders will often settle for less than the total amount owed when paid in full right away.)
C.Fortunato, Attorney
Category: Legal
Satisfied Customers: 8023
Experience: Admitted NYS Bar, member ABA, NYSBA, NYCBA, QCBA, Licensed Real Estate Broker
C.Fortunato and 19 other Legal Specialists are ready to help you
Customer: replied 1 year ago.

I want to keep the home if possible. And I want to negotiate with the judgment lien creditor to lower the amount. But since they put lien on my home, they won't negotiate easily. However, if I hint them that I will let the home foreclose, they will be more willing to negotiate right? Because if it foreclose, their lien will get removed and not secured anymore. I need some good advise how to negotiate to lower the debt. I'm willing to pay some but can't afford to pay the full amount in this bad economy.


 


 

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