If Ihave2 houses mortgaged with different banks, if one house is foreclosed on, can that lenderalso foreclose on the other house?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
If Ihave2 houses mortgaged with different banks, if one house is foreclosed on, can that lenderalso foreclose on the other house?
The house I was renting out is being foreclosed. The loan and title are in my name as well as my spouse’s name. Home is mortgaged by Lender A. They are now foreclosing on it. I have a second home titled and financed in my name only by Lender B. Can Lender A take action above taking the house they were financing? Specifically, can they put a lein on the house financed by Lender B?
Asked on November 1, 2010 under Real Estate Law, Ohio
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 14 years ago | Contributor
A mortgagee can only foreclose on property on which it holds a security interest (mortgage). Since Lender A only holds a mortgage on House 1, and it is a different entity than from Lender B, Lender A not cannot foreclose on House 2. However, if the sale price at the foreclosure auction (sheriff's sale) is not enough to pay off the remaining mortgage balance, plus costs,on House 1 then your Lender A can obtain what is called a "deficiency judgement". Generally, at that point Lender A can go after your other assets and seize them (as well as any of your wife's assets since House 1 is in both of your names). As a practical matter, Lender A would at best would likely place a lien against House 2 and be paid off (plus interest) at such time in the future that you sold or re-financed it.
Since you didn't give much by way of the specifics in your case and there may be some form of exemption, etc. that applies, you should consult directly with a real estate attorney in your area.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.