What are obligations after walking away from a mortgage.

UPDATED: Sep 30, 2022

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What are obligations after walking away from a mortgage.

We have a mortgage on a condo in Pennsylvania that we have rented out for a number of years.We have been losing money on this investment for a few years. Our tenant is moving out soon and we need to cut our loses. We became upside down on this property when the market crashed and never recovered. We are both in our seventies living on social security and can no longer afford the mortgage on this property.We see no options other than walking away from or investment. Any advice or suggestions from you would be greatly appreciated….Thank you.

Asked on March 24, 2016 under Real Estate Law, Delaware


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

Your state allows "deficiency judgments": this means that if you default on your mortgage and the lender forecloses, if the amount realized on the property from selling it in foreclosure is less than the outstanding balance of the loan, the lender can sue you for the remaining balance. However, social security wages cannot be garnished, so if you have few assets (e.g. large savings accounts or other real estate) which the lender could go after, you are relatively "collection proof"--with you main (or only) income being social security, if the lender sues you and you don't pay, there is little they can do to you. So you may well be safe to walk away from the mortgage.

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