Question:
I was wondering if anyone can help answer my question on what happens with a foreclosure while having an 80/20, Has anyone experianced this can you explain step by step on what happends to me not the home, and is it to the point that i would have to file bankrupsy or can i just walk and be free, even if i screw up my credit?
Answer:
I have an overview article on my blog. Check the URL below.
The true answer will depend on the state. Technically you have two loans. A 1st at 80% and a 2nd at 20%. Either lender can foreclose if you fail to pay on their loan.
If you are in CA and the action is a trustee sale then the lender will not be able to come after you if they do not make back all the money that is owed. In other states you might face a deficiency judgment if the lender does not receive enough from the sale.
The credit damage will impact you for year. It can impact what job you can secure if they check credit. If at all possible finding a way to sell and deal with the loans is better. A short sale is a possibility with some lenders.
Good luck.
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