Post foreclosure harrasment by lenders/collection agencies

[azhardspot]

Here is a quick summary of my situation

Loan institution - Countrywide/BOA
Home Purchased - Year 2005
Purchase Price - 340,000
Down Payment - 10% = 34,000
Mortgage 1 - 80% = 276,000 (6% fixed)
Mortgage 2 - 10% = 34,000 (7.5% fixed)
Current Price of the Home = 200,000
Mortgage payments - current
Hardship - None financially

Options
i think loan mod OR short sale seems very difficult
so foreclosure might be the only choice here

1. Foreclosure
My specific question here is regarding any post foreclosure harassment that lenders are involved with when a family goes through a foreclosure.
Legally the anti-deficiency statue doesn't allow the banks to go after the deficiency, but has any one seen any calls from collections agencies etc?

[Moe Bedard]

Welcome to LoanSafe.org!

1. Foreclosure
My specific question here is regarding any post foreclosure harassment that lenders are involved with when a family goes through a foreclosure.
Legally the anti-deficiency statue doesn't allow the banks to go after the deficiency, but has any one seen any calls from collections agencies etc?

Yes. I have heard of this happening many times, but mainly with the second mortgage being sold to a collection agency.

A short sale may be best if you are leaning on walking away.

[azhardspot]

thx Moe for the quick reply .. you are a great help to many of us here

1. have you seen of heard cases of a short sale being approved if there is no financial hardship ? especialy with CW/BOA

2. I hear that CW/BOa are the slowest when it comes to short sales.. has any of that changed or still the same?

thanks much

[caldwellb02]

Moe - soooo - if the first mortgage forecloses they can still sell the second to a collection agency? And the collections agency can harass? Even in California?

[knownick]

Originally Posted by caldwellb02

Moe - soooo - if the first mortgage forecloses they can still sell the second to a collection agency? And the collections agency can harass? Even in California?

Well, the second can certainly sell the loan off if there's someone willing to buy it. Whether or not that person will be able to collect is another story. It depends on whether or not the second falls under CCP 580(b) protection or not - ie was it a "purchase money" loan or not. Check out the video from The Professor in the sticky thread at the top of this forum.

[desertrat]

Caldwellb02,
Good question and from what I know, knownick was really spot on in his/her reply. I also wanted to add that there is another thread where the OP is facing this sitation - post-foreclosure 2nd lender or collection agency is harrassing for payment:
Already Foreclosed, HELOC Advice Needed

Hopefully the more we can all learn from what is happening with post-forclosure collection efforts, particularly for non-recourse loans, will be very helpful for all.

[Kimbly]

Originally Posted by azhardspot

1. have you seen of heard cases of a short sale being approved if there is no financial hardship ? especialy with CW/BOA

2. I hear that CW/BOa are the slowest when it comes to short sales.. has any of that changed or still the same?

thanks much

I also have CW/BoA. I have not tried a short sale (it would do me no good due to my 2nd and there are about 50 within a mile of me) but from the experiences of friends, I would say, no, BoA isn't going to approve a short sale withough a financial hardship. They should, in my opinion, as it's better for them than a vacant house, especially depending on where in AZ you are located.

I interact with realtors in my line of work and the all say that BoA is the absolute worst for a short sale. They don't respond to offers and give the RE agents the run around. Some I know are refusing to handle them but others say since BoA is the largest in AZ (since the acquisition of CW) that they feel they have no choice.

I'm hoping that BoA is still the slowest for foreclosures as I'm taking the 'walk away' route. I'm in Pinal County, and it's miserable out here. Even if I could get approved for a short sale (which I couldn't) it would take forever. Most in my neighborhood that have tried ended in foreclosure anyway since there are no takers.

Is all of your loan(s) purchase money??? If so, you should review the deficiency statutes. They may have no recourse against you.... although that doesn't mean they won't try.

[azhardspot]

Yes, both my loans (80 + 10) are conventional 30 year fixed
so yes they are "monies used towards purchasing a home" -> which means they are non-recourse ...

so after researching the arizona state legislature on liability for purchase money, i am convinced that there is no legal way for the collection agencies to collect from me if i foreclose

Format Document

however - the law protects you from getting a incorrect judgement issued against you, it doesnt protect you from collection agencies who want to harras you and disturb your peace and make your life miserable

thanks

[Kimbly]

Originally Posted by azhardspot

however - the law protects you from getting a incorrect judgement issued against you, it doesnt protect you from collection agencies who want to harras you and disturb your peace and make your life miserable

thanks

True - they can *try* and collect but a FDCPA complaint should make them stop.

[sharona]

My second told me they were going to send my account to collections at the end of the month and the first hasn't even filed the NTS yet. Both of my loans are purchase money here in california. I don't get it...what good would that do them?

Sharona