The foreclosure process, what do I need to do?

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After several rate adjustments and no help from our mortgage company we have prepared ourselves mentally to let our home go. I’m still young(24), I’m aware my credit would be shot. I can’t refinance since the loan(145k) is over the value (136k), so this isn’t an option I have. My question is, in Oregon can the mortgage company sue me for whats left over of the loan after the sale? Or will this debt be forgiven. Thanks!

7 Comments
  1. Reply
    Brad M
    February 22, 2011 at 5:45 am

    Try this website…

  2. Reply
    Net Advisor
    February 22, 2011 at 5:47 am

    I would not give up yet.

    The proposed $ 700 Billion bailout may include help for homeowners. This is being debated as we speak.

    In the event of a foreclosure, you would normally be on the hook for balance of the loan (difference of sale price and the loan balance, plus interest).

    The bank normally issues a 1099-C. Say you owe $ 100,000 after the house is sold. You get a 1099-C from the bank that says you earned $ 100,000 in income in additional to the actual income you got that year.
    http://www.unclefed.com/IRS-Forms/2001/HTML/p5230201.html

    This is phantom income for a “forgiven loan.”

    people had to file BK to default on the forgiven amount.

    I believe that there was a law passed that would allow homeowners to not take this amount as income on a primary home. Check with a real estate or bankrupts attorney or CPA on this question.

  3. Reply
    ananamas
    February 22, 2011 at 6:42 am

    It really depends on whether you have any other assets. If you are “judgement proof” (ie have no assets) the bank may forgive it because they have no hope of collecting it from you. If you have other assets such as equity in a car, bank accounts, etc. then the bank may try to collect.

    You would probably still be better off trying to short sale the house than just letting it go. Try discussing this with your lender’s loss mitigation department.

  4. Reply
    nice2meetu
    February 22, 2011 at 7:40 am

    There are other options than foreclosure like a short sale. Take a look at this website for more information on foreclosure prevention.

  5. Reply
    J A
    February 22, 2011 at 8:02 am

    Have you really tried everything?? i mean, i am not trying to sell you anything, but did you try loan nod or short sale?? letting it go it’s just too harsh…

    If you need extra info: http://www.homesolutioncomplete.com. We modify home loans, process short sales nationwide to relief all the problems that are associated with adjustable rates and the high mortgage payment etc… We are not realtors or brokers, we act as a neutral 3rd party working WITH the homeowner. Our rate is fixed and there’s nothing hidden either.

  6. Reply
    James T
    February 22, 2011 at 8:57 am

    http://www.homelandassistance.com offers a map, on which you can choose your state and see what options are available to you. Maybe that would help?

  7. Reply
    Jennifer
    February 22, 2011 at 9:30 am

    Hi,
    I used “Credit Solution” to settle my debt and avoid bankruptcy.They managed to reduce my debt up to 58%.It’s legitimate,I came across this company on NBC News Special Edition.Check it out here:
    http://CreditSolution01.notlong.com

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