foreclosure

Losing your house has to be the worst kind of financial failure. Most people would stop paying all their other bills before they let the house go. You would lose your credit then your cars and then any other things you have like the electricity and then finally the house. It would be better just to go bankrupt up front and avoid all that stress.

 

Magnus, I would guess you don't have the full story from him. No way they come calling after two months of missed payments. Just no way. I'm guessing he is 6 months behind at least. As back-logged as the mortgage companies are with people not paying, I just don't believe they got around to him after two months.

"i believe the debt he's walking away from will be considered income by the IRS..."

Only if it is forgiven by the lender. Otherwise, they will just sue him for the difference in what he owes and what the home brings in a foreclosure sale. So, if he owes 100K after it gets sold and the lender agrees to forgive 50K if he works out a payment plan with them, then he would have a 50K tax problem. If they sued him for the 100K, and they would rightfully win the full amount, he would have a 100K debt problem with $0 tax problem (he wouldn't even get to write off the loss that the home creates which really sucks all the way around for him).

 

I agree, except some folks live in a "throw-away" society, haven't established a real set of values.

 

I don't know what state this is in, but Wolfpac is on the right track. If this is in North Carolina, many actions would occur before the sheriff locks him out. The mortgage company would not pursue foreclosure by opening a file until you haven't made a payment for 4-6 months. A trusteee or substitute trustee will open a Special Proceeding file in the Clerk of Court's office. A hearing will be scheduled 3-5 weeks later, notices sent to everyone. The hearing will be held and then a foreclosure sale 3 weeks later with more notices filed. The sale will be held, and then remain open for 10 days. At the end of the upset period the party that won (usually the note holder) will then have to file notice of ejectment with the clerk of court, with more letters to parties. After the hearing, the new owner then has to go to the sheriff with the clerk's findings and schedule the eviction. The Sheriff has 10 days to notify the occupant of the date of ejection. This means the actual time is around 9 months. Many people who decide to no longer pay the mortgage decide to remain in the home through the whole process, obtaining "free" housing for 3/4 of a year at least.

 

Your friend is not being up front with you about something. Nobody is going to take you directly from paid in full straight to foreclosure. You pass through the loss mitigation and collections groups for quite a while before you get to foreclosure.

 

yeah, he's not talked about hearings, any of that. He did have a re-fi going and there was a dispute over whether the tax had been covered, then they drug their feet. That's when he said he didn't pay for two months, which I have no idea why he would stop paying.

But, he did have more house than he needed anyway, and in reflection, just spent a bunch of money on car repair. He's got like $50,000 worth of sports and music memorabilia which makes the whole thing much more bizarre.

I have some fucking retarded coworkers when it comes to money. One has gov't assistance, because she's a single mother and the kid's father is in jail...she was going to declare bankruptcy to get out of debt - which I said wasn't the right thing to do if she could handle it - and got in a wreck in her too-expensive SUV. Instead of being able to get out from under that payment and into something reasonable, she went out and bought another brand new SUV and rolled the overage into that car. She always poor mouths when we deal with money and then on payday she has manicure, pedicure, and a new outfit.

I just gotta wonder how people can become professionals and functioning retards at the same time.

 

I think there's a huge underlying sense of entitlement.

I have a job = I deserve all this stupid shit. Isn't everyone else buying it?

Consumerism, yo. It pays my bills.

 

Total BS. He's missed at LEAST 3 payments. Probably 4+. There is no way in hell he didn't know. Mortgage companies do not want to foreclose. They aren't in the real estate business. He was most likely 2+ months behind when he started to refi...probably went FHA (takes forever) and they declined him due to him being behind. Missed 2+ more and was foreclosed on.

 

Hey Mag, you distancing yourself from the slacker?

 

no, but I don't like that he's not being honest given I know where he is on this. I'll help him all I can when it comes to making sure he has any help he needs but don't lie.