Will trasferring the title on your home to an LLC protect you from a foreclosure deficiency judgement?
Question:
Answer:
No, unfortunately, that wouldn't work. They bank doesn't sue the owners of the house for the deficiency judgment, they sue the debtor on the loan. If you're signed on the mortgage as being responsible for the payments, that's one responsibility that you can't transfer to someone else.
Banks rarely sue for deficiency judgments, though, because they know that homeowners in foreclosure do not have a lot of extra cash to pay another judgment. It costs the banks too much in terms of time and court costs, when they have already lost money on the loan (thus creating the deficiency in the first place). In years of working with foreclosure properties, I haven't seen one instance of a bank suing for a deficiency judgment -- it's just not worth their time to lose more money pursuing something they'll never be able to collect on.
The transfer of the property wouldn't protect the people listed on the mortgage, but there is little real danger of being sued for a deficiency judgment.
Hope that helps.
ForeclosureFish
http://www.foreclosurefish.com/...
You cannot transfer title without permission from the lender. I doubt they will give permission if you are going into default.
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