Maryland homeowners shocked by deficiency judgments and collections
Dear Readers -
Roy Kelley shares his warnings to foreclosure households. His comments are very important even if the laws vary in each of our states. If we don’t know the law in our state, we won’t be able to advise our Clients during the Foreclosure proceedings.
Don’t miss Roy’s lovely photograph - a spot of beauty in a post about a sad topic.
Have a happy day -
Lynn
PS In case I haven’t thanked you personally, I really appreciate every time you stop by to read and/or comment on my posts. L.
Maryland homeowners shocked by deficiency judgments and collections
The Washington Post reports that “Years after foreclosures, old debt haunts homeowners….Lenders are filing new motions in old foreclosure lawsuits and hiring debt collectors to pursue leftover debt, plus court fees, attorney’s fees and tens of thousands in interest that had been accruing for years.” – Kimbriell Kelly
After going through foreclosure, many families assume that the mortgage debt is satisfied as they focus on restoring their financial health. In Maryland, it appears that debt collectors have up to 36 years to pursue homeowners for amounts owed on deficiency judgments.
Lenders have learned that collections are doubtful if they take place a short time after a foreclosure. Experience has shown that if they wait a few years to give the mortgage borrowers time to recover, the chance of collecting the deficiency will be greater.
Some lenders are targeting strategic defaulters with collection actions. If mortgage borrowers were able to pay other bills but not their mortgages, they could be considered to be strategic defaulters. Part of the strategy of collection efforts is to deter future strategic defaulters.
Those that have gone through a foreclosure and did not file bankruptcy to clear their debts have long term reasons to be concerned with a possible deficiency judgment and collection actions. Once a judgment is entered, a lien attaches to real estate owned. A Chapter 7 bankruptcy could clear debt but those filings are now available to people earning no more that the state’s median income, which is $108,915 for a family of four in Maryland.
Years after foreclosures, old debt haunts homeowners
Peony, Kentlands IMG_5461
Photograph by Roy Kelley using a Canon PowerShot G11 camera.
Roy and Dolores Kelley Photographs
We represent home buyers and sellers as their exclusive agents in the Maryland suburbs of Washington DC.
Roy Kelley
Roy Kelley & Associates
Associate Broker, RE/MAX Realty GroupClient Assistance: 301-670-8996
Recipient of the RE/MAX International Lifetime Achievement Award - 2008
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