Mortgage Default- can they come after me?

Discussion in 'Budget Board' started by DisneyBeagle, May 21, 2007.

  1. DisneyBeagle

    DisneyBeagle <font color=brown>I also love sidewalk chalk and I

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    A year ago I sold my home to a lady. Apparently, she has defaulted on the loan and the house will now be sold to the highest bidder. If the mortgage company doesn't recoup the money they loaned to her, is there any way that they can come after me for the difference? :eek:
     
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  3. Chris

    Chris DIS Veteran

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    Not if your name isn't on the house or mortgage.
     
  4. DisneyBeagle

    DisneyBeagle <font color=brown>I also love sidewalk chalk and I

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    No, my name's not on the house or mortgage. Well, I guess the mortgage would list me as the person that was paid the money....I guess that doesn't count.
     
  5. janets

    janets A bad day at Disney is better than a good day anyw

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    If she got a mortgage with a bank, her name is on the mortgage and she's liable for it, and the house is the collateral. She used the money to purchase the house and they hold a lien on it, not on you.

    So you don't have any responsibility to the bank unless you were a co-signer on the mortgage.
     
  6. ExPirateShopGirl

    ExPirateShopGirl <font color=blue>My posts are sanitized for your p

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    You didn't default on the loan, she did. Makes no difference who sold the home to her, SHE is the individual who failed to make payments as promised, for which she will lose her collateral (the house.)

    In some states if the house is auctioned for an amount less than the mortgage, the bank cannot collect the difference from the owner.

    You're in the clear.

    :)
     
  7. tjderf

    tjderf Earning My Ears

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    When you sold your house, your mortgage would have been paid off. Unless you are a signer on the new owner's mortgage, you will be fine.
     
  8. seashoreCM

    seashoreCM All around nice guy.

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    If you let the buyer take over the payments or otherwise "assume" your mortgage loan, then under some circumstances the bank can come after you if the buyer defaults.

    When selling a house you need to be sure the paperwork says that your mortgage loan will be fully paid off at closing, too. You do not want a loan assumption to be attempted without your knowledge and permission.

    If the closing is not taking place at the new lender's office or at a well known "title company" office, it is a good idea to have your own attorney overseeing the transaction and also handling the deed and moneys. Actually it is a good idea to have your own attorney in any case. You don't want someone in cahoots with the buyer absconding with money and not paying off your mortgage loan.

    More: http://members.aol.com/ajaynejr/assume.htm
     

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