If credit card company gets judgement against home in Fl. - What if it is foreclosed

[Martha31]

Thanks

That would mean the mortgage holder B of A in this case would have to pay even more money to sell the home I will give up. Is this correct?

[StartingOver08]

No, aren't you talking about BOA foreclosing on your home? If they are foreclosing, then the jr liens, including any judgments, get essentially wiped out in the foreclosure. BOA is not going to pay the judgment to get clear title - that is what the foreclosure does - gets rid of all jr liens, including second mortgages and judgements.

If you are surrendering your home - the lender will continue the foreclosure and sell the property as an REO property when they finish.


Now, if you are talking about a short sale - that is different. In a short sale the jr lien gets 'paid' but usually a very small percentage of the balance. I had a short sale approved today where the 2nd mortgage is getting $16k and the original 2nd mtg was $200k. The first is getting the rest, except for $3k going to a lien. So if you are referring to a short sale then yes, the lender has to pay more (or receive less) to clear the title. Of course, BOA is not really closing many short sales at all - so the issue is moot.

[Martha31]

B of a

I plan on letting bank of america foreclose. So that means all the credit card companies who place liens against the house will not get a penny.
Thanks for the enlightening information.

[hereforinfo]

I plan on letting bank of america foreclose. So that means all the credit card companies who place liens against the house will not get a penny.
Thanks for the enlightening information.

They won't get a penny but the judgement will still exist against you, and potentially attach to any future property you purchase. Actually, you would not even be able to get another mortgage with an unsatisfied judgement so I guess it doesn't matter.

[StartingOver08]

hereforinfo and BB2U are right - the judgement continues to exist after the foreclosure unless you file BK or pay the judgement off.

[2Bshinyandnew]

If I have equity in my Florida homestead, can an unsecured creditor who has gotten a judgment against me get a lien against my homestead property? I thought my Florida homestead property was safe from creditors. If that is the case, to hell with a mortgage mod, I better file BK7 as soon as a one of my unsecured creditors try and sue me.

[Martha31]

A word on judgments here is in order. 'If' you get a judgment against you the 'holder' of the judgment is the one who decides what they want to do with it to enforce it.

Also all state laws are different, so this may not apply, but in general this is how it works.

So, lets say you get sued (like Hub sued some people in small claims court) but he does nothing with his judgments. Well then he holds the judgments (that do have some value) but unless he does something with them them nothing will happen. But he has ten years to hold them (longer in some states and renewable also, but a failure to renew in time and it will expire with no hope of ever getting it back).

So now you get a judgment against you it is up to the holder of the judgment to go looking for ways to enforce the judgment. The absolute simplest is to place a lien on any real property you have (like a house). It then sits there until something triggers an event that requires it to be paid off. Like the sale of the house or a refi (the reason this triggers the event is because you need clear title and that can only happen when the judgment is paid off).

Now in some instances if enough equity is available in the real property and the judgment holder has sufficient resources (money) they can force the sale of the house (real property) by paying off the senior liens and then they can move to foreclose on the property to force the sale to pay off the judgment (or worse case is you own your house free and clear and they force the sale to pay the judgment).

Now lets say you have a judgment they filed a lien on your house and you have a mortgage or two or three. You default on the mortgage, and the lender decides to foreclose. If there is not sufficient money to pay off all the liens in the order posted before (other than some mechanics liens and tax liens they are often most senior) than any other lien or mortgages are shed at the foreclosure sale. If no one bids then the lender that is foreclosing must at least bid what they are owed (and if they are not the first lender, say they are the 2nd then they had to pay off any lenders before them and are now also owed those monies, since they now bought that note also). So the foreclosing lender is able to strip off any liens (other than tax liens they must be paid and special assessments).

So now the party who had a lien (from a judgment) on your house is back to the beginning with a judgment and no lien. Now the party with the judgment can also at the same time as putting a lien on your house, attempt or have a wage garnishment going and attempt or continue to seize money in bank account(s). They can also attempt or seize any personal property that is not exempt (and it is up to you to show what is exempt).

A judgment can be bought and sold also, they are sold to people or companies that buy them and then they specialize in the collection of the judgment. The judgment lives on, the person or company that sued you drops off and a new owner steps in (this is why the mini-miranda on collections letters make mention of judgments).

So, now if your the holder of a judgment you can do nothing and get nothing or you can try one or all the above and they can be done simultaneously until the judgment is satisfied.

While a judgment is a handy tool to collect from someone, you need to be the one working your judgment to make sure you can collect on it. If you do nothing with it, then you get nothing back. Often times you just need to sit on it for a few years then go on an asset search to find the judgment debtor now owns property you can lien on, has a job you can garnish etc.

I hope this helped make this a little less confusing.

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My wife is on the mortgage 1st and 2nd both which are owned by bank of america. But she is not on any credit card debts. Could BofA come after her bank account or garnish her wages for the 2nd mortgage? Does giving back the house eliminate that possibility since the 2nd mortgage was secured by the property? BTW my income is pension and she could retire anytime.

Thanks

[hereforinfo]

If I have equity in my Florida homestead, can an unsecured creditor who has gotten a judgment against me get a lien against my homestead property? I thought my Florida homestead property was safe from creditors. If that is the case, to hell with a mortgage mod, I better file BK7 as soon as a one of my unsecured creditors try and sue me.

No, in Florida your homestead is 100% exempt except for: "payment of taxes and assessments thereon; obligations contracted for the purchase, improvement, or repair thereof; and obligations contracted for house, field or other labor performed on realty."

[Martha31]

Depends on if your in a community property state, if the items bough benefited the marital community, also sure they can go after her for the mortgages and you will find cross collateralization clause also I am sure. I don't know if you are in a deed of trust state or not, typically even if you are the second mortgage still can come after you for any deficiency.

You need to talk with a BK attorney you to much at stake and to many variables.

Florida is not a deed of trust state or a community property state. To be on the safe side we will put her monies in my son or daughter's bank account.
I may be screwing up, but I do not plan to use an attorney. I am just shedding assets so nothing will be there for the creditors to get. In Florida, the homestead is considered community property.

[floridian]

i am so screwed... my saga goes on...its been 8 months since i quit paying my cc bills... as you might recall, i was told that i could get a 7, but its a 13 or nothing without more expenses..

i hired a lawyer, but have just been sitting on the problem, to see whats going to happen next...

just this month, my cc accounts have been turned over to collection agencies... my lawyer said that eventually i will probably get sued...

i have been sending all the agencies certified mail, refering them to my lawyer... so far, no more contact...

since my wages are protected from garnishment, the only thing i fear, is a judgement againt my home in florida...

i have very little equity in the place and i could walk away... but if a judgement is obtained against my homestead, it will follow me to the grave... i will never be able to buy another house with an outstanding judgement, im told...

so, if it ends up that i cant file bk, then i guess i need to buy some rope!

any suggestions?

[Martha31]

Children

Do you have any children you could put a house deed in thier name. My children will wind up with my assets anyway when my time is over on this planet.

[floridian]

no kids, just cats....
the only lawfirm that has contacted me, was from a credit union that i owe seven grand from a repo... i figure they will be the first to actually take me to court..

i could care less about the house, but my credit is pretty much done forever, i believe..
the lawyer told me that i can wait out the SOL for four years on the ccs, but that wont do much for a judgement..

[747LUVR]

In the state of Florida- where my wife and I live, our only home is homesteaded. Our atty said no big deal if a judgement/lien is added to our house, it will be vacated once we file ch 7. Even if we had equity-which we dont-our atty told us we wouldnt loose the house, as we are current and will not be defaultingon the mtg. Is anyone here saying this isnt so? thanks for your input. Thats why at this point, the threats of suits agaisnt us doesnt even bother me to flinch, for all i care, they can spend money on atty's and giving some to the lawyers, I actually feel like I can help fill some coffers. lol

[StartingOver08]

The BK gets rid of your personal responsibility to pay the debt. If it is a judgment by the time you file, there is one extra step that the attorney has to do to vacate the judgment - but then it is gone. Just remember to tell the attorney that you have a judgment so he can get rid of the lien! That is why BK is so powerful

[Martha31]

The BK gets rid of your personal responsibility to pay the debt. If it is a judgment by the time you file, there is one extra step that the attorney has to do to vacate the judgment - but then it is gone. Just remember to tell the attorney that you have a judgment so he can get rid of the lien! That is why BK is so powerful

There is no set time limit for BK is there? I am thinking I would file in a couple of years, if even then. If BK laws were to be changed that may force me to do it quicker.