We just did a short sale on our house in VA . Though first bank has forgiven the debt but the second bank has not givin anything in writing that the debt has been forgivin. We did short sale in April 2010. Can the second bank still persue us. We have never refinanced our home. Lived only 4 years in that home. Please advise.
Thanks so much for responding ! But during the time of short sale our realtor told us that the second bank will not persue because a new rule have been passed in April that lenders cannot persue you after short sale for the debt. So thats fine . But am confused now . We also did 10% of the debt payment during closing to the second bank. Please advise as what should we do now as its been 2 months after short sale.
If you only negotiated a release of the lien from the second lender, in order to sell the house, and did not negotiate a release of the debt, then, yes, the lender can pursue you for the balance. Not all do. If they do pursue you, you will need to negotiate a payment of the balance. If they do not pursue you, in all likelihood, they will issue a 1099 form for the forgiveness of the debt.
This answer does not constitute legal advice and does not and is not intended to create an attorney-client relationship. The law may vary depending on the state in which you reside. It is intended only to give some direction in which to seek assistance.
Yes, they can pursue you for personal liability on the note on the 2nd, and many lenders are doing that in Va.