Thanks for the update. I have the exact same time frame as you but I have not received my trustee sale yet. How did you find out? I checked online on the "Maricopa County Recorder" site and it has not been lasted. My loan is too with Seterus backed by Fannie. Thanks again. Have a good one.Originally Posted by gumbymaywalk
Thanks for the update. I have the exact same time frame as you but I have not received my trustee sale yet. How did you find out? I checked online on the "Maricopa County Recorder" site and it has not been lasted. My loan is too with Seterus backed by Fannie. Thanks again. Have a good one.
We are in pima county and I checked on Friday and it ashowed it was posted on Thursday, but the paperwork showed a date of 5/11/12. Ours is with Seterus and backed by Fannie Mae as well. We received two letters each one week apart from Lawyers title who was retained to do the foreclosure. Just keep checking the website, bit for us getting those letters from lawyers title was an indication that things were moving along. Best of luck!!
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Hello,
Well after being on the fence for 3 years we finally decided to walk.
Purchased home 7/07 365K in Mesa AZ
After 20% down loan at 290K
Loan now @272K (1st)
Home value approx 200K (zillow has it at 197K)
We never missed a payment but as of today May 10,2012 no payment was sent.
Our plan is to return to our other house in Oregon (currently a rental), hoping to save as much as possible in the meantime.
We are a little nervous, wanting the foreclosure to be complete before 12/31/12 due to MDRA.
My question is, since it's a 1st non-recourse loan and we live in a anti-deficiency state would I'd be on the hook for taxes on the difference between sale of the property and what is owed on loan.
This is all so surreal. This forum has been a lot of help. I know my question has probably been answered already but I guess I'm just reaching out for some support. I'm at the point now that I'm angry that I've waited so long.
We bought within our means, have 2 very good jobs. With the 75K cash down payment and including what we have been overpaying in payments we have already pissed away a college education. I can't continue doing this.
Thanks for any advice and I'll keep you updated on the process.
UPDATE:
Missed 1st payment and starting to get the recorded message phone calls. Also a letter regarding late payment.
June will be 2nd missed payment.
Hope to be foreclosed on by 12/31 but I realize this is unlikely. Now all I can hope is that Congress will extend MDRA.
If not all the money I'll save in mortgage payments will go to the IRS. Oh well I'll still be rid of this money pit.
Thanks will keep my walk updated.
Checked credit karma again today because of that little message about my delinquent account being brought to current and now it has the mortgage as foreclosure started and it says it is reporting 120 days late. So I have no clue why it was brought to current a week or so ago as it had to be that as I have no other accounts delinquent. But I wanted to post as I was surprised ck have that much info as it had only been saying that I had a delinquent account, not with whom or how delinquent it was. Does anyone know how many days they report or how it matters? I thought I read once it gets over 180 days late its not so much in the algorithms. According to ck I'm holding at 723 but credit see. Has me at 712 with a recent 31 point drop.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Just got my sale date of 8/22/12. First missed payment on 1/12 so just over 8 months for the foreclosure process for the maricopa county. Have you
looked into "Cash for keys"?
I will certainly take it its offered but I'm not counting on it. When we leave I will shut all utilities off except maybe electric so I can leave the lights on outside as well as keep the blind shut as usual maybe even keep some planters and little things outside. I want to make it look occupied for the bad neighborhood as well not just for cfk. I hate the thought of leaving before the sale and having to come back to check on it, but with kids and pets I don't want to push leaving until the last minute. I plan on being out at least 2 weeks before the auction date for safety.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Received our sale date of 8/16/12 this past week. Our first missed payment was Aug 2011, so it'll be one year from miss to foreclosure (Citimortgage first, Chase second; both were purchase money, non-refinanced loans, though the Citi was modified 2 years ago... haha to them!). Moved away from Arizona last month... still paying HOA fees, but otherwise shut off all utilities and set the boat adrift. Hopefully, this will be the end. Best of luck to all my fellow Aug-Sept walkers!
Hi ORSURFER,
With regards to taxes, you should not be incurring any tax liability with non-recourse purchase loans such as in Arizona.
Your tax liability would be your debt minus your purchase price and any improvements. ie. 272k - 365k = -93k Far less than zero so no tax liability. You don't need the MDRA in Arizona due to the non-recourse law. I suppose if the loan was more than the purchase price (ie took money out, refinanced) you could be on the hook for the a taxable cancellation of debt as well as loosing the non-recourse protection. I hope this helps.
From the IRS Website:
Step 2 – Figuring Gain from Foreclosure
4. Enter the fair market value of the property foreclosed.For non-recourse loans, enter the amount of the debt immediately prior to the foreclosure ________
5. Enter your adjusted basis in the property.(Usually your purchase price plus the cost of any major improvements.) ____________
6. Subtract line 5 from line 4. If less than zero, enter zero.
redpeak,
Thank you for your response. The loan was for purchase price only.
On the verge of missing 2nd payment. From what I've been reading it looks like I'll still be in this house till after the new year.
I'll keep my walk updated as t moves forward.
Thanks again,
orsurfer
Good luck with the transition. I know its not an easy decision to make.
Here is the whole article from the IRS website regarding cancellation of debt income. You should read it over to see how it applies to you based on your situation. I would recommend talking to a CPA or tax attorney if you are unsure, however it seems simple enough surprisingly.
The questions and answers, below, are based on the law prior to the passage of the Mortgage Forgiveness Debt Relief Act of 2007.
1. What is Cancellation of Debt?
If you borrow money from a commercial lender and the lender later cancels or forgives the debt, you may have to include the cancelled amount in income for tax purposes, depending on the circumstances. When you borrowed the money you were not required to include the loan proceeds in income because you had an obligation to repay the lender. When that obligation is subsequently forgiven, the amount you received as loan proceeds is reportable as income because you no longer have an obligation to repay the lender. The lender is usually required to report the amount of the canceled debt to you and the IRS on a Form 1099-C, Cancellation of Debt.
Here’s a very simplified example. You borrow $10,000 and default on the loan after paying back $2,000. If the lender is unable to collect the remaining debt from you, there is a cancellation of debt of $8,000, which generally is taxable income to you.
2. Is Cancellation of Debt income always taxable?
Not always. There are some exceptions. The most common situations when cancellation of debt income is not taxable involve:
- Bankruptcy: Debts discharged through bankruptcy are not considered taxable income.
- Insolvency: If you are insolvent when the debt is cancelled, some or all of the cancelled debt may not be taxable to you.You are insolvent when your total debts are more than the fair market value of your total assets.Insolvency can be fairly complex to determine and the assistance of a tax professional is recommended if you believe you qualify for this exception.
- Certain farm debts:If you incurred the debt directly in operation of a farm, more than half your income from the prior three years was from farming, and the loan was owed to a person or agency regularly engaged in lending, your cancelled debt is generally not considered taxable income.The rules applicable to farmers are complex and the assistance of a tax professional is recommended if you believe you qualify for this exception.
- Non-recourse loans:A non-recourse loan is a loan for which the lender’s only remedy in case of default is to repossess the property being financed or used as collateral.That is, the lender cannot pursue you personally in case of default.Forgiveness of a non-recourse loan resulting from a foreclosure does not result in cancellation of debt income.However, it may result in other tax consequences, as discussed in Question 3 below.
3. I lost my home through foreclosure. Are there tax consequences?
There are two possible consequences you must consider:
- Taxable cancellation of debt income.(Note: As stated above, cancellation of debt income is not taxable in the case of non-recourse loans.)
- A reportable gain from the disposition of the home (because foreclosures are treated like sales for tax purposes).(Note: Often some or all of the gain from the sale of a personal residence qualifies for exclusion from income.)
Use the following steps to compute the income to be reported from a foreclosure:Step 1 - Figuring Cancellation of Debt Income (Note: For non-recourse loans, skip this section. You have no income from cancellation of debt.)1. Enter the total amount of the debt immediately prior to the foreclosure.___________The amount on line 3 will generally equal the amount shown in box 2 of Form 1099-C. This amount is taxable unless you meet one of the exceptions in question 2. Enter it on line 21, Other Income, of your Form 1040.
2. Enter the fair market value of the property from Form 1099-C, box 7. ___________
3. Subtract line 2 from line 1.If less than zero, enter zero.___________Step 2 – Figuring Gain from ForeclosureThe amount on line 6 is your gain from the foreclosure of your home. If you have owned and used the home as your principal residence for periods totaling at least two years during the five year period ending on the date of the foreclosure, you may exclude up to $250,000 (up to $500,000 for married couples filing a joint return) from income. If you do not qualify for this exclusion, or your gain exceeds $250,000 ($500,000 for married couples filing a joint return), report the taxable amount on Schedule D, Capital Gains and Losses.
4. Enter the fair market value of the property foreclosed.For non-recourse loans, enter the amount of the debt immediately prior to the foreclosure ________
5. Enter your adjusted basis in the property.(Usually your purchase price plus the cost of any major improvements.) ____________
6. Subtract line 5 from line 4. If less than zero, enter zero.
Getting close to the sale date... originally scheduled for 6/19. My question is... the house is not showing up on LPS site or really anywhere else. I saw one local publication back in April that listed the upcoming trustee sale, but that's it. Shouldn't the address pull a bunch of search results being only a week out... assuming that the sale is not postponed?
I have an unrelated question for anyone. I recently left a condo in AZ and moved to OR. It's up for short sale but it's been 4 mo now and i don't want to pay the $100 for hoa anymore. I hope it sells soon or maybe it will foreclose. I'm still paying for minimum charge for electric and city. Do you think I should still pay hoa fees.
Any advice appreciated, tom
Tom,
You should definitely still pay the HOA dues, your HOA dues are assessed against the property and are also a personal debt. They actually have priority over your lender's loan under the rules relating to priority. So, HOAs can and do attempt post-foreclosure collection against the foreclosed former owner and it can come in the forum of a judgement or wage garnish depending on your states allowance.
Best Regards,
Cat Damiano
LoanSafe.org Moderator
The comments by me and the materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Most of the information you find here is easily available on the internet. You should contact your attorney to obtain advice with respect to any particular issue or problem. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney. Please Read our Privacy Policy and Legal Disclaimer Here.
Now I did post this in the April/May walkers thread but wanted to update here as well.
My stats: 1st- 3 payments missed owe 145k
HELOC- 1 payment missed owe 33k
House value- 88-94K
I received a letter about HELOC stating I was seriously delinquent(1 missed payment is seriously delinquent?) and I needed to call them within 3 business days to make arrangements to catch up. If I don't they are turning this over to their legal dept bah blah blah.
Anyway I know they will be more aggressive due to the fact they will be a SOJL after foreclosure but this letter freaked me out just a little.
Ok deep breath, I feel better after writing this.
Best to all,
candace
Question guys. So come home today and a copy of the notice of trustee sale was posted on my door. I removed it as they had it half taped to the door and the door frame, not on the window as I have seen. Anyway as I said I removed it to get into the house. Is it legal to remove them? Kinda funny as the sale date is 8/20 weird that they are posting it so soon.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Thanks for your post. To your questionthe answer is no, removal is not legal. You should have left that posted notice be, and entered your home via another door or a window, LOL.Is it legal to remove them?
doh guess I'm a law breaker then. No other door to enter and 8 foot windows being a little over five feet will not happen. There was a window right by the door they could have taped it to! Weird thing is got my first call from Seterus (different number ) about an hour ago. Haven't called. Me since January when I instructed them that all calls had to go through my attny. Weird no message left either.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Another update: Received certified letter "Notice Of right To Cure Default" today. It states I have 30 days to make up the 3 late payments. The letter also included the name and number of my new Mortgage Servicing Specialist.
candace
trustee postponed... got call from debt collector representing second. He said it didn't matter if my second was purchase money, that it was a collectible debt and he would be in contact. My legal council advised me that purchase money second (original 80/20) are not collectible in AZ. Should I worry about this, or prepare for spending more money (that I don't have) on legal representation for a fight that might come my way?
GustavsenB
Thanks for your post.
You needn't retain a lawyer. Settling a 2nd is no big deal. I recommend you visit the following thread and read post #1. Good luck!
Strategy for Settling Your 2nd
Your legal counsel is correct. I'd ignore any/all efforts at contact by the collections agent. He's just trying to blow smoke and scare you into a settlement. If/when you were ever sued (unlikely, given AZ mortgage law), you could then have your counsel answer the suit and request a judgment of dismissal.
I attended the auction this morning... house reverted back to beneficiary. For you experienced folks... what can I expect to be the next step and/or correspondence? We went ahead and vacated the property in anticipation of the auction because I didn't want to scramble at the last minute and settle on a rental or other arrangement that was less than desireable, so turns out no cash for keys or timelines on moving (tradeoff). The second mortgage holder I guess is now considered a "sold out junior"? This was a purchase money second, and it's quite easy to see in the original purchase documents where the money came from. Related to my posts above, are there any immediate steps I should take with the collections agency that is contacting me for a settlement of the balance?
Anyway, I'm hoping this is nearly over... even though I resolved myself to the whole thing many months ago, it still has not been easy on the family.
GusavsenB
Since you've already vacated, you'll never again hear from your 1st lender, i.e. no communications. As far as your SOJL, I recommend you never again communicate with them, and recommend you never consider settling that virtually worthless debt.
Thanks Tom. I really appreciate all of the help, experience and information available in this online community. Couldn't have done this without all those who have contributed.
Another AZ walker just checking in to "unite"
Details in my main thread Preparing to walk in AZ - open call for thoughts..
Last edited by russellaz; 08-02-2012 at 01:58 AM. Reason: typo
Small update. After auction, I made sure to call the agent named on the notice that was posted on my door. Thought it would not be an option for me, but wrong I was. Cash for keys done... 2 weeks, $2k. Done.
We're done!
The house was listed to auction on July 11th but we were never able to find any kind of record, even with the recorder's office, that it had actually sold. But now we know it did because it's listed for rent. So glad to be done. We haven't run our credit yet.
Bought: 2006
First missed payment: Dec 1 2011
30 yr fixed only with Countrywide/Bank of America/Fannie Mae
Did your house sell to a high bidder or go back to the bank? thanks
My house went back to the bank (Fannie Mae). It's now listed for $179,900. I bought for $315K in 2006 and was still sitting $120K upside down given the current list price. So glad to be done with it.
Well... back with a question. As recommended by Tom, I planned on never communicating with the collections agency on the sold out second unless absolutely necessary. Certainly not planning to settle on anything. The pesky collectors keep calling my office and now the homes of my local relatives looking for me. Question: Can I (should I) send a cease and desist letter to their corporate office directing them to stop contacting me and put in writing that I'm done... house is gone, trustee's deed recorded, etc. Thoughts??? Would doing so lend any legitimacy to their cause? I want them to leave me alone.
I have protection under AZ statutes... the ARS text reads
33-729. Purchase money
mortgage; limitation on liability
A. Except as provided in subsection B, if a mortgage is given to secure the
payment of the balance of the purchase price, or to secure a loan to pay all or
part of the purchase price, of a parcel of real property of two and one-half
acres or less which is limited to and utilized for either a single one-family or
single two-family dwelling, the lien of judgment in an action to foreclose such
mortgage shall not extend to any other property of the judgment debtor, nor may
general execution be issued against the judgment debtor to enforce such
judgment, and if the proceeds of the mortgaged real property sold under special
execution are insufficient to satisfy the judgment, the judgment may not
otherwise be satisfied out of other property of the judgment debtor,
notwithstanding any agreement to the contrary.
GustavsenB
Thanks for your post.
Since the collection people continue to place harassing calls to your office and your relatives, you might send a C&D letter. I recommend you disclose no personal for financial info nor admit to owing the debt. You may, if you wish, cite applicable sections of the FDCPA.
Thanks Tom. In a way, I don't want to make myself a target for more focused action from them, but at the same time I feel like I'm being harrassed when they have no legal right to pursue me further. I may wait a bit longer to see if things continue (or worse, intensify) before I send a letter. So far, only one written communication received from them and that was the initial "statement" demanding payment in full on the balance of the note.
Ha last week got a letter from Seterus via my lawyer that they could not approve my modification hahaha never applied for one anyway and that they would have to continue their collections. Well yesterday was an emotional day for me! First off received my first water bill for my rental as well as my final for the house and the leak they had here last month is still going on. Have had plumbers and leak detection here all AM. So glad I am renting and this is not my bill. Hoping they are good about this months bill and next as its not my issue that the leak wasn't repaired well! Anyway it was also the auction day. I called the trustee service in the AM to find out if the sale was still scheduled. I was told it was but that it could be canceled up to the scheduled time. I asked if I called back after that time if I could be told if it had happened and was told yes. I waited and called back about 4 hours later and was told yes it indeed happened. I just wanted off the phone so I didn't ask if it was sold or if it reverted back to Fannie. I spoke to my lawyer and he said it can take a week or more for the county recorders office to record the trustee title (I think that is what he called it) and that would say who the property went to. I hope it happens sooner than later so I can get a copy for my records. I called the homeowners insurance and canceled this AM as I asked the lawyer if I should wait until it is recorded he said to feel free to do it now as my liability is pretty much nil now. I am supposed to get a refund within 10 days. That is nice and unexpected as they already refunded me as I had billing switched to me just in case and the mortgage company paid them when they were sent a receipt. Oh well if it comes in my name it shall be deposited in my bank account. Now then I am hoping to find a note from a real estate agent on the door. I would love to play like I still live there in hopes of cash for keys! Lord knows I could use it with all we spent on moving, deposits, double utility bills etc. I guess thought I will not believe its really over until I see it posted somewhere as up to yesterday only realtrac and one other site even had it listed as in foreclosure!
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Hi gumbymaywalk
Thanks for your post.
You can log into the LPSASAP site (free but you must register) and find out now. Or call your trustee again and ask.
thanks Tom. I just tried that but I think I'm doing it wrong. First I tried a general search with my city, county zip and the date and nothing came up. Then I even tried my ts# and nothing is coming up. What am.I doing wrong? I would love to see the info so I can be assured that it happened. Just really don't want to call the trustee again that got me all worked up.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Although I've often used the site, I'm no expert. You might call or email the site's "help" contact.
O figured it out but its not there so I called the oh so nice trustee and she said it went back to the bank. Done!!!!!
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Question: so there was a notice on the property door this afernoon from a real estate agent representing Fannie Mae. Giving options about renting, buying and relocation assistance if we vacate the property and leave it in broom clean condition. I would love to get this cash for keys offer, but we have already vacated. It says to call within 10 days. We have been going over and checking on the outside but have not gone inside since the auction on Monday as we didn't want to break any laws since it went back to Fannie. Anyway there is a key lock box on the door and I didn't try my key, but did take the notice. How do I proceed? Do I play it like I still live there or do I say we still have belongings there but can vacate within a week with relocation assistance? I don't want to say something wrong and get caught in a lie but we could really use the money! Thanks.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
Well I got in touch with the lawyer last night and he called them this AM. No cash for keys as supposedly they had already confirmed vacant and they are changing the locks today. They offered 10 days if we needed it to remove any property we had left but I said to decline as we have nothing left there. I asked how they verified that we were not living there as we have gone over almost every day to check the place and keep up the front to make it looks as though someone were there for security reasons. He said the agent said there were notices in the door and phone books by the door which is not true as we went by twice the day before and twice yesterday looking for this notice. Oh well at least it is done. Cant say I am not nervous still as we did take the fridge and our washer. We paid for them as the ones that came with the house did not work and we didn't know until we moved in! The lawyer had suggested that we replace them with junk but I didn't want to give that house anymore of my money period. We didn't touch the stove, dishwasher or the brand new ac/furnace we put in as those are permanently installed and all I have read washer/dryer, fridges are personal property as they are not permanently installed so I took the chance. We did no damage to the property because we were leaving but there are maybe 500.00 in repairs that need to be done (new closet door, bedroom doors and an unfinished interior ceiling patch) that need to be done but they were from way before we decided to leave and we didn't see the need to put anymore money into repairs when we were leaving. We were not one of those that broke windows, walls etc just didn't finish repairs. I hope this doesn't come back to bite me but I cant see anyone leaving their home in foreclosure sinking money into cosmetic repairs before leaving. The house is indeed inhabitable and nothing was broken on purpose and we maintained it once we left so I hope that is enough for Fannie Mae. So there ya go a couple weeks short of nine months from the first payment missed to the house going back to the bank.
Purchased: 2007 for $167.00 (10yr IOO) always paid more to make a dent in principal
Servicer: Seterus, backed by good ole Fannie
Still owe: $163,000
Zillow estimate as of 1/4/12: $83,200 and continually falling.
Trustee sale: 8/20/12 back to Fannie and locks being changed 8/24/12. No cash for keys offered as we vacated.
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