Virginia Deficiency Judgement (Judgment) at Foreclosure? Current Trends & PMI

I have an answer for you in New York.

The SOL in New York is 6 years from the date of last payment.  So, they 5 1/2 from now to sue you for DJ. 

2.  In your case, the answer is b.  It is clear they have nothing to collect if they get a judgement and it is expensive to get one.  DJs are rare and are used for people with a great deal of non retirement assets. 

3.  20 cents isn't too awful.  10 cents would be more reasonable.  Get the offer in writing.

In my case, I haven't paid the first or second in 1.2 years in a judicial state.  I haven't heard one peep from them in the last six months other than to foreclose which didn't take me anytime. 

In conclusion, you are from NYC (the city of taking advantage of others).  So, put a smile on and be glad that you are in the driver's seat for once.

I live in VA and have been dealing with Wells Fargo on a short sale for the past 6 months. I have a 2 loans, both by Wells Fargo. My first mortgage has approved the short sale but my second refuses unless they get a higher payoff than the first mortgage is willing to offer. Both are not willing to negotiate. The second mortgage suggest I could potentially request a settlement on which i'd probably pay 15 cents on the dollar owed which would clear me. Anyone have any experience to share on not being able to get approval on both loans? I assume it is worth settling to avoid the foreclosure mess and possible/imminent DJ? thanks.

Most of these RE lawyers charging $400/hr arent worth minimum wage. Did they ever tell you that if they do file a DJ against you, just file for bankruptcy. Whats it going to hurt? Your credit? LOL.

I am so glad I stumbled across your site. I purchased my home in Fairfax, VA in 2006 for 315K; I put 75K down and got a fix rate 30 year mortgage at 6%. I made approx 70K a year at the time I purchased, had a credit score of 805. I was well qualified, well prepared. Then came the recession. I took pay cut after pay cut with my company until I was eventually laid off. I was out of work for 6 months. During that time I depleted all my savings staying a float in my home. I moved in with my now husband while continuing to make payments until I could find a renter for my home. I found a renter all was well for 6 months until she stopped making payments. The last unit like mine sold for 180K. This life investment has tuned into the absolute money pit! I am employed again but make a meager 45K a year. I spend every penny I own on this home in Fairfax. I have cashed in my 401K to make repairs to the furnace and the pipes and to maintain tax and increasing HOA payments. Despite never having missed or even been late on a payment for any bill for the past three years I have no more money to keep paying for this property. I am absolutely sick with panic everyday on a DJ coming down on me if I foreclosure. I am not even sure how I foreclose. Do I mail the keys to the lender and pray for the best. How does one go about something like this? Am I going to be riddled with debt collectors and garnished wages?

AinVa, email me, I have some ideas

This will be our last entry on this website--the last chapter in our saga, you might say, which began with our posts (#22&25) of June, 2008.  Not sure if anyone has been following our posts, but in the hope that our experiences can be a comfort and help (as many of the posts on here have been for us) to anyone going through what we've been through, we thought we'd close this out.

Last month HSBC sent us a form 1099-C for the 2nd trust, basically canceling any remaining liability/debt on our former home. Our attorney and our accountant both say we are clear now. We got the 1099-C on the first trust last year.

Prior to the real estate market going south in VA, we purchase some property in a rural part of SE Virginia, and are now in the process of building a home there (for cash!). This experience has really changed us for the better. We have no debt, plenty of money in the back, and a new peace that's hard to explain. The bank's behavior though all of this is no less baffling now, we're just glad to be out from under this mess.

For anyone going through foreclosure or a frustrating shortsale ordeal, our advice would be, get a good real estate attorney, a good accountant, and do what is in your own best interests. Don't worry or fear things that you can't control. Things will work out, and you'll be ok. The pain and hardship are never as bad as you imagine, so don't "catastrophize" about it; move on with your life, enjoy your life.

Frank, thanks for keeping this website up and thanks to all for all the helpful comments over the last few years. God is goood!

Ben

This will be our last entry on this website--the last chapter in our saga, you might say, which began with our posts (#22&25) of June, 2008.  Not sure if anyone has been following our posts, but in the hope that our experiences can be a comfort and help (as many of the posts on here have been for us) to anyone going through what we've been through, we thought we'd close this out.

Last month HSBC sent us a form 1099-C for the 2nd trust, basically canceling any remaining liability/debt on our former home. Our attorney and our accountant both say we are clear now. We got the 1099-C on the first trust last year.

Prior to the real estate market going south in VA, we purchase some property in a rural part of SE Virginia, and are now in the process of building a home there (for cash!). This experience has really changed us for the better. We have no debt, plenty of money in the back, and a new peace that's hard to explain. The bank's behavior though all of this is no less baffling now, we're just glad to be out from under this mess.

For anyone going through foreclosure or a frustrating shortsale ordeal, our advice would be, get a good real estate attorney, a good accountant, and do what is in your own best interests. Don't worry or fear things that you can't control. Things will work out, and you'll be ok. The pain and hardship are never as bad as you imagine, so don't "catastrophize" about it; move on with your life, enjoy your life.

Frank, thanks for keeping this website up and thanks to all for all the helpful comments over the last few years. God is goood!

Ben

If we wanted to protect a retirement home in case our current mortgage goes into foreclosure, could we?  Or would we have to sell it or get a lien against it for the DJ?

Angela,

I do not know if this advice may be too late for your sister -- but here goes:

If her ex-husband is refusing to obey the property settlement agreement, your sister should file a motion to show cause (contempt).  He is thumbing his nose at the court.  He may face fines or jail time by refusing to obey the divorce decree.  He is also exposing himself to civil liability for the damage that he is doing to your sister's credit.  This is more a family law matter than a real estate matter.

Why has this blog stopped?

If anyone is still listening.....any good refernces for attorneys and CPA's?  I am in process of short sale and want to make sure there is no DJ.

Also what is the best way to negotiate the deficiency and possibly pay it off with 15% so deficiency is forgiven?

Thanks much

Hi everyone. I hope this blog is still active as there hasn't been any new posts here since August. Here is my home mortgage nightmare:

In 2005 I bought a 1890 Victorian home in Danville, VA to retore and live in. It was a foreclosure and the bank was taking sealed bids. Unfortunately for me I got the house. It appraised for $300k at the time and I paid $100k cash (my life savings). After living in it a while a found it needed much more extensive work than I realized even though I am an experienced at working on old houses and even had a home inspection prior to closing. The house had undisclosed fire damage that had been hidden behind new sheetrock work. I found out the bank wasn't liable for the non-disclosure of hidden damage because of it being a foreclosure. I ended up taking out a $90k first mortgage at 6.57% and that all got eaten up fast just in roof and structutal repairs. I felt I was still doing ok as the house still appraised for $300kish. I then took out an $50k equity loan to finish the rest of the house after which Wachovia (now Wells Fargo) said they would refi me both loans into one. As I was nearing completion the market took a dump and now Wells Fargo says I no longer quality for a refi. I applied for the Hardship Loan Mod program and they strung me along for a year before telling me I don't qualify. I have had the house on the market for 3 years with 3 different Realtors. I only got one offer which became a contingency contract. After several months and 2 contract extensions they gave up because they couldn't get their house sold. In the meantime I've ended up on Social Security Disability for cancer and get about $1800/month. I was lucky enough to get lung cancer even though I am a life long non-smoker. With all expenses trimmed down on a good month I spend $1900/month and if something unexpected comes up (like the exhaust system falling off my car last week) then its more. I've depleted my savings, have no credit cards but so far I am not behind on anything and my Credit Rating is still around 800. Wells Fargo won't work with me though they did offer me a "Deed in Lieu" but only if I pay off the $50k Equity loan which obviously I can't do. This last month I am down to just $18 to my name and will certainly start falling behind. I have already sold my second car (the better one) and all my antiques and furniture and am living on a mattress on the floor and card tables for the computer etc. I had been keeping even by selling my belongings but not much left of any value to sell. I have also now been diagnosed with Prostate cancer as well so more medical copayments ahead over and above my current ones. Fortunately I have Medicare with the SSD but still have the copays. I owe $140k-ish and the appraisel that the contingentcy buyers got on the house showed it now worth $240k. I think the bank wants it to go into foreclosure as they have a chance of getting their money back. I had lowered the price so it would just pay the mortgages and the Realty fees and I'd get nothing but no takers. Anyone have any advice?

Thanks,

Dave

Hi all-

This thread is extremely insightful!. I have a house currently going to FC with Bank of America in northern VA.
I purchased the house in 2006 and within in 6 months of me living in the home, the market begin to nose dive. in 2006 I paid 226k for the home however in 2010 prince William county valued the property at 70k. now in 2011 I am sure it’s worth even less. i have 2 loans (80/20 split) the larger loan is behind  however the smaller loan 20% of the purchase price is up to date. how does foreclosure work in this instance?  does the bank eat any of the loan amount since the value of the house has fallen  more than half of the purchase price?  how can they come after me for hundreds of thousands of dollars when the home is not even valued at the purchase price? I guess that doesn't matter?

Hello to everyone,  I am hoping that someone can give me some suggestions.  My husband and I purchased a house in VA.with Countywide with a first and a HELOC because our other house had not sold yet. The purchase price was $525,000.  By 2010, we started pursuing a loan modification with them, they now became the infamous Bank of America.  We sent in a hadship letter and the whole packet of what was requested about 6 times, even with the help of real estate friends.  Nothing, except a letter to us saying that our mortgage was going up $500. a month.  We decided to do a strategic walk away, not paying anymore.  After a year, the house was sold by a trustee on the courtroom steps for $304.000 in July of 2011. We moved quickly, into a rental.  About 6 months later, we start getting phone calls from Greentree demanding the $57,000 they are telling us we owe.  BOA separated this loan to Greentree just before the foreclosure.  Now we have gotton a letter from a law firm EPPS in VA Beach representing Greentree.  Obviously they may be going for a DJ, and its making us sick.   We don't own anything else.  How far can they go with this and is this the new trend?  Thank you, Virginia