Does having PMI on your house help you after the house has been forclosed

Asked about 2 years ago - Glendale Heights, IL

My home mortage has PMI and the house was just foreclosed and sold by the bank. Will PMI protect me from the bank coming after me or sending me a 1099 in the mail

Attorney answers (2)

  1. Adam J. Lysinski

    Pro

    Contributor Level 9

    1

    Lawyer agrees

    Answered . I think you should start by checking the language on the judgment entered in the foreclosure. The majority of the 1099s come from second lien holders and short sales. If you want to know your exposure to possible personal judgments, I would encourage you to speak to an attorney that can review your assets/liabilities, income/expenses and the actual judgment entered. Good Luck.

  2. Mara Ann Baltabols

    Pro

    Contributor Level 13

    Answered . The purpose of PMI is not to protect you, but the lender from losses. It's required to offset potential losses to the lender where the borrower did not put 20% or more down at origination. Was your loan a HUD backed/FHA loan? That may also influence whether or not you had to pay PMI. In terms of getting a 1099, you will not if the loan was your primary residence at the time you bought the home and until it was foreclosed upon. Take the advice of the other attorney regarding checking to see if a deficiency was entered against you.

    The information in this answer is not intended as legal advice nor do I intend to create an attorney-client... more

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