80/15 Loan; 80 For Gave Deficiency, 15 Now Says I Owe A Balloon Payment???


LoanSafe Member
Mar 28, 2011
My house sold short Jan 2011. Dec 2011 Chase forgave the deficiency. Amtrust, in receivership with New York Community Bank (nastier than Chase if that is possible) did not address the deficiency issue in any paperwork. I bought the house with an 80 (Chase) 15 (Amtrust) loan. The state is Idaho. The agent was not supposed to sell the house if I owed a deficiency. It sold the day before it was to foreclose.

Checking my credit report in 2012 (still like this in 2014 with one of the credit agencies saying I lost my dispute over this - they still list the house in foreclosure, not sold short and still list the debt with Amtrust - which is how I found out what follows) I saw that Amtrust now states that I they have forgiven around $31,000 of the loan but I have not received a 1099C. They then also say I owe a balloon payment mid 2022 of around $14,000. I did NOT sign a promissory note at closing concerning this. They have made no attempt to collect on any of this debt since the house has sold short.

1) Is the statue of limitations on the debt from when they stopped trying to collect when the house sold in 2011 (I have not heard from them since the house sold - no bills, no letters, no phone calls, nothing - I still live at the address I lived in when the house sold which is out of state from the house as I got a job out of state and the stupid house took 35 months to sell) or does the clock start ticking in 2022 when they claim I have this balloon payment?

2) Can they even say I owe a balloon payment if I didn't sign anything to that effect at closing? Also if I don't pay the balloon payment can they even come after me for that since they haven't even tried to collect on the debt prior to then? Will that trash my credit all over as the mortgage stuff is scheduled to drop off my credit report in 2017?

3) I have read that for a promissory note, like a mortgage, the statute of limitations is 5 years in Idaho but then there is language I don't understand that, to me implies that since I moved out of state it stops any count on the statue of limitation???

4) How the heck do I go about getting a foreclosure that didn't happen off my credit report when sending a copy of the sales documents didn't seem to matter to the stupid credit reporting agency?

5) What the heck can I do about the Amtrust mess and do it in a way that does not restart the count for the statue of limitation?

To everyone else reading this who has not sold your house. DO NOT sell short unless you see with your own eyes that the deficiencies are going to be forgiven. Do not trust your agent. Mine lied. Instead, if your state is a non recourse state or has only a short statue of limitations for them to come after you and they refuse to forgive the deficiency - foreclose. Idaho they only have 90 days to come after you if you foreclose. Looking at the mess I have now I would have been better off taking the credit hit (heck with the credit reports wrong I already have) with a foreclosure than have this mess with the deficiency from the short sale with a 5 year statue of limitations.

Thank you,

Moe Bedard

Call 1-800-779-4547
Staff member
Loan Safe Mortgage
Aug 10, 2007
Southern California
Hi Liz,

Agents OFTEN lie because they are in the commission business and sometime truth will ruin a sale. I'm not a big fan of most real estate agents and salespeople because lies and hype are always part of their sales game.

Do you have it in writing that the home was not to be sold with a deficiency and that Chase forgave the deficiency as well? The 2nd mortgage would have to approve the short sale and agree to release the lien. What happened at the time of the sale with Amtrust?

The statute of limitations would start when the home finally changed hands and the date title was taken out of your name.

Personally, this looks like it may just be a mistake in reporting due to the conflicting facts and you may just have to sort it out through Amtrust and the credit reporting agencies.

The balloon payment is probably in the language of your original contract which they may be going by. But again, if the home sold at short sale, this should have all been worked out then. Hence, it is either a mistake or your agent committed fraud or you may have signed papers you didn't realize you were signing leaving you on the hook for the 2nd mortgage. You need to go over ALL this paperwork and see what really happened.

The statute of limitation applies to the state where the home was located and they would have to abide by the states laws you are in now to collect. But my understanding is they can only collect via the Idaho statute of limitation and also what state you are in now in regards to "how they can collect" from you.

You may be able to get help based on the Fair Debt Collection Practices Act (FDCPA) and Fair Credit Reporting Act (FCRA) .

Your rights under the Fair Credit Reporting Act:

Access to your credit file is limited only to people with a valid need (usually to consider an application with a creditor, insurer, employer, landlord, or other business ) not to third parties for the purpose of marketing;

You must be told if the information in your credit file has been used against you;

You have a right to full disclosure of the contents of your credit file;

You have a right to request your credit score;

You have a right to dispute incomplete or inaccurate information in your credit file;

You have a right to have incorrect, incomplete, unverified or outdated information corrected or removed from your file;

You have a right to know if and when an adverse action was taken against or if you were denied credit, insurance or employment based on the contents of a credit report;

You have a right to opt-out or to remove your name from unsolicited offers of credit and insurance;

You must give consent for credit reports or criminal background checks to be provided to employers. When an employer uses credit reports or criminal background checks to evaluate its employees or employment applicants, the FCRA requires employers to:

disclose to the employee or employment applicant, in a document consisting solely of the disclosure that a credit report or background check may be obtained about the individual for employment purposes; obtain the employee’s or employment applicant’s written authorization to obtain the credit report or background check; and where the employer intends to take adverse action based in whole or part on a credit report or background check, then it must first provide the employee or employment applicant a copy of the credit report and a summary of their rights under the FCRA, as published by the Federal Trade Commission (“FTC”).


LoanSafe Member
Mar 28, 2011
Thanks Moe.

I have e-mails after the fact (as most of what was done during this was over the phone or in person) when I questioned him why the deficiency. He didn't dispute that I had said no sale if a deficiency since the ID laws were good with respect to a foreclosure. HE had in writing that Chase would not excuse it. He withheld that final letter from me. I have email exchanges about that after the fact. With the second I NEVER saw ANYTHING one way or another about this and it would not appear he has anything in writing. I was in the middle of chemo when the house sold (was actually doing chemo the day I signed the papers and faxed them from the hospital fax machine). I was stupid and trusted him as his kid and mine were on the same soccer team for years…

I have a 1099C from Chase (the primary - was bought with an 80/15), so I am presuming that is OK (that is Dec 2011, house sold Jan 25, 2011)

It is Amtrust/New York Community Bank (the second) that it is listed on the credit report that I still owe. I called them in 2012 and they claimed this is correct (took forever to find someone who even admitted they still had my mortgage as initially they claimed they never heard of me). I contested that with my credit report in 2012 and when I just got my hands on my credit reports again yesterday Experian says they checked and it is correct and the automated system won't let me protest it again so I guess I need to do it snail mail. Transunion, where I also contested it, have no outcome of that protest - or even a comment I am contesting it - on my credit report. The other one apparently doesn't give you your report online so I have to get it snail mail as that website kicked me into paper form to download and mailing instructions. I did NOT sign a promissory note at closing. I had nothing at all that addressed what they were doing. They sent a bill maybe for 2 more months after the house sold and then stopped sending anything. I had called them immediately and told them the house sold. They said, tough you still owe the money. In the end they, New York Community Bank - Amtrust was in receivership), were incredibly difficult to deal with - nasty, you are a low life losser, type of response any time I tried to talk with them. Chase was a giant pain in the rear but not nasty.

As far as I can figure out they have 5 years for a promissory note in ID (where the house is) and 3 years (so now expired) in MS (where I live now). What I was also worried about is when the balloon payment came due the entire thing would start all over and they'd list it again on my credit as a debt now overdue again that I was now defaulting on.