We are in Arizona. Our house went into foreclosure in Mar 2010. At that time we have two loans 1st loan is 5/1 arm and second one is balloon loan schedule to pay in 30 years. It's a purchased money and it satisfies Arizona anti-deficiency, two loans were taken at same time in 2006 (no refinance after that) and all the money went into purchase of the home( no cash out). We got 1099 C from both lenders and we filed taxes with no issues. Currently we are renting a home. After learning from our mistakes we have saved and borrowed some money(personal loan) from family to buy home with cash since no lender will give loan for us now. Is the first or second lender still can come back on us or they can keep any kind of lien on new house? Anyone’s help is much appreciated.
Assuming the home you lost in 2010 qualified for anti-deficency protection (2.5 acres of land or less, 1 or 2 family dwelling), and both loans were purchase money, then the former lenders may not pursue any other asset other than the collateral, i.e., the former house lost to foreclosure. The new home will be perfectly safe from them.
Based upon the information you provided, it does appear that the anti-deficiency law would be applicable to your previous home. If that is true, then you have no risk of any part of that old transaction attaching to a newly purchased home. The 1099C is further indicative that you are on the right path. Normally, the 1099C is only issued if the loan truly has been forgiven. That may not always be true, but combined with your other facts it surely points in that direction.