Mortgage foreclosure
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Mortgage foreclosure
If my house is foreclosed on can that bank putt a lien on a mobile home I own or on a rental that I have a mortgage with through another bank?
Asked on June 19, 2009 under Real Estate Law, Indiana
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 15 years ago | Contributor
Yes, a deficiency judgement may be obtained in Indiana. This occurs when a property in foreclosure is sold at a public sale for less than the loan amount that the underlying mortgage secures. This means that the borrower still owes the lender for the difference between what the property sold for at auction and the amount of the original loan. The lender can come after the difference (ie "deficiency") by filing a lien against (ie "attaching") other of the debtors assets. In your case this would certianly include your mobile home and investment property.
S.J.H., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 15 years ago | Contributor
Once the house is foreclosed upon the house will be auctioned and the bank will use the money received to satisfy its loan that you had. If it fully recoups it you will technically be entitled to seek a refund of any surplus. If it sells it at a loss, it can seek the balance of the mortgage from you. If it acquires a Judgment against you for this difference, it can seek to put a lien on your property such as the mobile home or other property you own. If the bank merely takes it back, it has an obligation to mitigate damages and try and sell it to the highest bidder but again any difference can be sought against you.
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