Can we be persued for the balance of our mortgage?
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Can we be persued for the balance of our mortgage?
We want to walk away from our house, I understand that it will wreck our good credit, but need to know what else can happen to us. We can still afford our payment, make a fair income, and have paid for vehicles.
Asked on February 23, 2011 under Real Estate Law, Idaho
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
Idaho does allow what is known as a deficiency judgement: that is, a mortgage lender, after foreclosing the house and selling it at a foreclosure sale or auction, then applying the proceeds of the sale (less certain administrative costs) to the mortgaqe, may sue the homeowners for any remaining balance. So if you mortagage is, say, $200k, and your home is sold for a net of $150k, they could legally sue you for the remaining $50k. Whether the lender will or will not do this depends on many facts: how much you'd still owe; whether they think they can get the money from you (if you make a good income, they may feel that they can), and even "corporate culture"--some lenders take a harder line than others. Overall, deficiency judgments are NOT sought more often than not, but the lender has the option to seek one if it wants.
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