Are foreclosure deficiency awards allowed in illinois?
Question:
I have a friend who co signed for me on two properties that are now in default. he does not want to file bankrupt because he says they will take his 2nd car and truck , as well as his money that he has saved , which is about $20,000. I'm afraid to file as they will go after him, is there another solution ?? he thinks that after foreclosure it will just be reported to his credit and maybe he could clean it up somehow.
Answer:
If there is a deficiency after the foreclosure and sale, they may hold both you and your friend liable for it. It may very well be worse than just a bad mark on credit reports.
Since you say you are just in default right now, and they haven't foreclosed yet, I would suggest that both you and your friend speak with a real estate lawyer.
The lawyer may know of ways to handle the problem so it will not end up in foreclosure, by dealing with the bank, possible right to cure, short sale, etc., etc., etc., or what to do to lessen the financial impact after a foreclosure happens
I think that it is great that you are concerned about your friend and not planning on throwing the friend to the wolves.
Sincerely, speak with a real estate attorney as soon as possible since there may be avenues that you can take to protect the both of you before a foreclosure happens, or after the foreclosure.
good luck to both of you
i don't no
If the property sells at sheriff sale for less than the amount that you both owe on the house, the lender could pursue a deficiency judgment.
Deficiency judgments are pretty rare among mortgage companies, though, in any state. Most of them are aware that it will cost them more money to sue for the judgment than they have any reasonable chance of collecting. They know most people enter into foreclosure because they have too little money, are behind on their other bills, and can't afford their current expenses, let alone one more judgment.
So it is conceivable that the bank could sue for the judgment, but it's not that common.
Good luck.
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