How bad is foreclosure?

**forclothers** · 10-16-2011, 03:07 PM

If someone paid 500K of a 600K loan and then forecloses, what do they get back? What if they paid 100K towards a 600K loan?
Do they get fined for foreclosing? Can they continue the same loan with how much they put towards it if they re-buy the same house they foreclosed on?
Does the .gov help pay for like an apartment or something if foreclosing makes a family homeless?
Thanks.

**Greg** · 10-17-2011, 06:17 AM

The foreclosure laws are different in every state. here are some general rules which might apply depending on where you live.

If someone pays off $500K of a $600k loan and the bank sells the house for $100k at foreclosure the prior owners gets nothing. If the bank sells it for $150K the seller gets $50K minus the banks cost for foreclosure and holding/selling the property.

If the bank sells it for $80K then the bank can come back after the prior owner for the balance if the prior owner lives in a recourse state.

If they paid $100K of a $600K loan they can expect the bank to come after them for the balance if the house is in a recourse state.

If the prior owner buys it back in foreclosure they will have to pay cash because they will not be able to get a loan for 7 years or so.

The only help from the government is called welfare.

Check on your local laws before you do anything.

**clemy** · 10-20-2011, 10:22 AM

And another thing to keep in mind, there are now companies buying up foreclosed mortgages and holding on to them so they can sue the former homeowner in a couple years after the homeowner has rebuilt his/her assets. So even if the current mortgage holder doesn't sue for recourse, someone else might in a couple years. If you live in a recourse state, find out what the statute of limitations is.

**CC Lifestyle Realty** · 11-08-2011, 08:56 AM

Get an attorney for anything regarding a Foreclosure! They can help negotiate with the bank and hopefully get signed legal documentation stating the bank will not come after you for any loss.