Need Advice

babbles

LoanSafe Member
Feb 11, 2009
97
3
8
I Feel like I am coming to the end on my rental homes. I have a tenant that is breaking the lease after only 3 months of a year lease. I am working with the property management company to have the house returned in same condition and they can go. The house is still about 57k underwater and getting tired of the rental thing. I have unfortunately 3 liens on one home and wondering if I can file bk just for my two homes in which the other tenant is falling apart at the same time? I will talk to the lien holders first but I want from under the homes, its become a hassle dealing with tenants. Who else can I talk to legally. Thanks.
C
 

Evan Bedard

Call 1-800-779-4547
Loan Safe Mortgage
Aug 26, 2007
18,837
48
48
San Diego, California
www.LoanSafe.org
Hello Babbles,

I'm sorry to hear of your rental troubles, having a lousy tenant can ruin this experience and any additional income you've been anticipating. BK should always be used as a last resort and if you're considering a short sale you can always negotiate a "waiver of deficiency" clause in the agreement. However, with 3 liens attached to one of the rentals this may be very difficult to accomplish. What state are these properties located?

You may also want to visit the following thread for a comparison of your options to rid of these properties. Start by reading post #1. SS vs DIL vs FC Comparison
 

babbles

LoanSafe Member
Feb 11, 2009
97
3
8
Georgia

My property is in Georgia which I think is a recourse state.


Hello Babbles,

I'm sorry to hear of your rental troubles, having a lousy tenant can ruin this experience and any additional income you've been anticipating. BK should always be used as a last resort and if you're considering a short sale you can always negotiate a "waiver of deficiency" clause in the agreement. However, with 3 liens attached to one of the rentals this may be very difficult to accomplish. What state are these properties located?

You may also want to visit the following thread for a comparison of your options to rid of these properties. Start by reading post #1. SS vs DIL vs FC Comparison
 

Evan Bedard

Call 1-800-779-4547
Loan Safe Mortgage
Aug 26, 2007
18,837
48
48
San Diego, California
www.LoanSafe.org
Georgia's FC statutes do permit deficiency judgments post foreclosure, however we've found them to be rare in any state. Other than simply walking away from these properties, the only options you have would be to apply for a loan mod in hopes of a lower monthly payment, or a short sale and negotiate that the lender waives their rights to the deficiency. A DIL will likely not be an option as your servicer will require the home to be listed on the market for at least 90 days prior to submission, and unfortunately the FC process seems to be quite fast in your state.

GA Foreclosure Law in regards to Deficiency;

"The foreclosure sale may not produce enough cash to pay the loan balance in full, after deducting expenses and accrued unpaid interest. In this case, the lender may be entitled to a personal judgment against the borrower for the unpaid balance. The lender is not required to seek a deficiency judgment and most commercial and residential lenders in Georgia do not seek deficiencies; however, it is allowed. Deficiency may also be obtained against any endorsers or guarantors of the note and against any owners of the mortgaged property who assumed the debt by written agreement. If any money remains from the foreclosure sale after paying the debt and other liens, such as the second mortgage or any mechanic's liens, expenses and interest, these proceeds are paid to the borrower.

If the lender seeks a deficiency judgment in Georgia, the lender must file for a deficiency within thirty (30) days of the foreclosure sale and follow the procedures outlined in OCGA § 44-14-161, or the claim for a deficiency is barred. The foreclosure sale must be confirmed and the deficiency judgment must be approved by a judge of the Superior Court in the county in which the sale occurred."
 

babbles

LoanSafe Member
Feb 11, 2009
97
3
8
Thank you

Georgia's FC statutes do permit deficiency judgments post foreclosure, however we've found them to be rare in any state. Other than simply walking away from these properties, the only options you have would be to apply for a loan mod in hopes of a lower monthly payment, or a short sale and negotiate that the lender waives their rights to the deficiency. A DIL will likely not be an option as your servicer will require the home to be listed on the market for at least 90 days prior to submission, and unfortunately the FC process seems to be quite fast in your state.

GA Foreclosure Law in regards to Deficiency;

"The foreclosure sale may not produce enough cash to pay the loan balance in full, after deducting expenses and accrued unpaid interest. In this case, the lender may be entitled to a personal judgment against the borrower for the unpaid balance. The lender is not required to seek a deficiency judgment and most commercial and residential lenders in Georgia do not seek deficiencies; however, it is allowed. Deficiency may also be obtained against any endorsers or guarantors of the note and against any owners of the mortgaged property who assumed the debt by written agreement. If any money remains from the foreclosure sale after paying the debt and other liens, such as the second mortgage or any mechanic's liens, expenses and interest, these proceeds are paid to the borrower.

If the lender seeks a deficiency judgment in Georgia, the lender must file for a deficiency within thirty (30) days of the foreclosure sale and follow the procedures outlined in OCGA § 44-14-161, or the claim for a deficiency is barred. The foreclosure sale must be confirmed and the deficiency judgment must be approved by a judge of the Superior Court in the county in which the sale occurred."

Appreciate this valuable information.