Buying a home after foreclosure?

Asked over 2 years ago - Phoenix, AZ

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.


Additional information

Thanks a lot Robert, It is less than 2.5 acres of land or less, 1 or 2 family dwelling (single family) and I forgot to tell it is our primary resident.
I appreciate your help.


Attorney answers (3)

  1. Robert H Nagle

    Contributor Level 10


    Lawyers agree


    Best Answer
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    Answered . 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.

    Accessing this website or receiving an electronic transmission from Nagle Law Group, P.C., or any specific... more
  2. Douglas Garth Edmunds

    Contributor Level 13

    Answered . 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.

    Douglas Edmunds is in the business of helping people and companies file for bankruptcy protection. The bankruptcy... more
  3. Jeff Tomberg

    Contributor Level 14

    Answered . speak to a lawyer. if there is no deficiency then neither lender has recourse. if there is homestead then neither may have recourse either. after speaking to a lawyer you will be able have your questions answered

    without a detailed review by a lawyer can all the issues raised in your question be appropriately addressed...... more

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Property foreclosure

If you miss too many mortgage payments, your lender can start foreclosure proceedings to take ownership of the property, but it has to follow your state's laws.

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