Loans, Debt & Credit - View Single Post - Who has walked away and had a 2nd that was recourse?

KT in CA · 12-12-2008, 11:34 PM

Met with the attorney. First of all, he said that he has never seen a judicial foreclosure. Nor has seen banks come after anyone yet for firsts or seconds, and that the second only has 3 or 4 months (I can't remember which he said) to do so. He doesn't seem to think the second will, more so because its the same company. I think they will, so we'll see. He also mentioned that they are expecting the next big wave of foreclosures to hit summer of 2009.

He said the deficiency will fall under the IRS Debt Forgiveness act for us for Federal. His concern is state implications. Hopefully we can work with the Franchise Tax Board when the time comes to make an payment affordable. He said not to worry about the credit score too much. That even just 5 years ago, if you had a foreclosure on your report people would be mortified. Now, not so much.

He is also a landlord and just rented to a woman from Santa Rosa who is in foreclosure. He, and other landlords he knows, prefer to rent to previous homeowners because we have pride of ownership and know what it takes to keep up a home. He said with a steady income, job stability, and by paying down some of those bills we have, that we should be okay to find a place to rent. That was one of my biggest concerns.

He confirmed what others have said here that in CA it's at least 4 months before the ball gets rolling on foreclosures. Thinks we probably can stay here until June or July, but to leave before we are evicted. He won't rent to people who have been evicted and that's just all kinds of bad.

Also he said to try to put the emotions of the whole experience aside. It really is a business decision. We can celebrate Christmas in another house. We can celebrate birthdays in another house. It's just 4 walls and a roof, and if it means sacrificing the well-being of your family for it, then it's time to cut your losses and let it go.

I feel better now. So we will make our last payment on 12/16 and then that's it. I was re-doing our budget to project our income and expenses without making the house payment. Out of our approx $40k cc debt, I will be able to get rid of half of it by June. The remaining 2 cards I will keep paying each month, and it's possible I may be able to pay one of those off next December. So by this time next year I could have eliminated $30k cc debt! And that includes factoring in rent from July forward and a security deposit. Then I can easily pay off the remaining balance the following year.

12-12-2008, 11:34 PM	#13 (permalink)
KT in CA Senior Member Join Date: Dec 2008 Location: Vacaville, CA Posts: 520 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Who has walked away and had a 2nd that was recourse? Met with the attorney. First of all, he said that he has never seen a judicial foreclosure. Nor has seen banks come after anyone yet for firsts or seconds, and that the second only has 3 or 4 months (I can't remember which he said) to do so. He doesn't seem to think the second will, more so because its the same company. I think they will, so we'll see. He also mentioned that they are expecting the next big wave of foreclosures to hit summer of 2009. He said the deficiency will fall under the IRS Debt Forgiveness act for us for Federal. His concern is state implications. Hopefully we can work with the Franchise Tax Board when the time comes to make an payment affordable. He said not to worry about the credit score too much. That even just 5 years ago, if you had a foreclosure on your report people would be mortified. Now, not so much. He is also a landlord and just rented to a woman from Santa Rosa who is in foreclosure. He, and other landlords he knows, prefer to rent to previous homeowners because we have pride of ownership and know what it takes to keep up a home. He said with a steady income, job stability, and by paying down some of those bills we have, that we should be okay to find a place to rent. That was one of my biggest concerns. He confirmed what others have said here that in CA it's at least 4 months before the ball gets rolling on foreclosures. Thinks we probably can stay here until June or July, but to leave before we are evicted. He won't rent to people who have been evicted and that's just all kinds of bad. Also he said to try to put the emotions of the whole experience aside. It really is a business decision. We can celebrate Christmas in another house. We can celebrate birthdays in another house. It's just 4 walls and a roof, and if it means sacrificing the well-being of your family for it, then it's time to cut your losses and let it go. I feel better now. So we will make our last payment on 12/16 and then that's it. I was re-doing our budget to project our income and expenses without making the house payment. Out of our approx $40k cc debt, I will be able to get rid of half of it by June. The remaining 2 cards I will keep paying each month, and it's possible I may be able to pay one of those off next December. So by this time next year I could have eliminated $30k cc debt! And that includes factoring in rent from July forward and a security deposit. Then I can easily pay off the remaining balance the following year.