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What will happen to our business if we "walk away."
My spouse and I have been dealing with Chase since March 2009. We applied for a loan mod at that time and after all the pain of faxing, sending this and that, calling the exec. team twice a week; we just received our denial letter Sept 29. It stated that "the hardship was not permanent in nature." I am no longer working (unemployed) and I do not qualify for unemployment. My husband is self employed and his income varies month to month but overall our mortgage debt is too high (we owe $620K) and we are under water; the home is probably not worth more than $500K. We are still current but have been borrowing to pay.
Attorney answers (1)
CA has an "anti-deficiency" statute that says that if your mortgage was a "purchase money" loan, meaning this loan was used to buy the house that you live in - not a refi, not a HELOC - if you stop paying, walk away and let the bank foreclose, then the bank can only get the house back, they can't also sue you for the deficiency between what you owe and what the house is now worth. If that's the case, then they can't go after your husband's business or any of your other assets. A foreclosure will definitely ding your credit, however, by as much as 300 points, and a short sale will probably ding your credit by somewhat less.
Disclaimer: Please note that this answer does not constitute legal advice, and should not be relied on, since each state has different laws, each situation is fact specific, and it is impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue. This answer does not create an attorney-client relationship.
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Other answers (1)
ajith717
Answered by a user, about 2 years ago.
Hi,
I am not a lawyer and a struggling home owner in LA. My home loan mod with BOA is a cat and mouse game.They dont care and are playing games.We should get even.Dont walk away right away, Stay as far as you can and walk a way.You can save money in the meantime.There are so many things can be done to delay the sale or foreclosure by legally.Some are staying as long as 2 yrs with out paying mortgage,.Google these people called ASDN inc or google "how to delay the foreclosure and so on... Also check out the great website,(www.loansafe.org) I am not a bad person,but we have to go with the flow.I dont care about my credit score? Stay as long as you can and save the money.Or file chapter 7 or 13? 13 will strip your heloc. Hang in there and fight those fat cats. Best of luck. Related Questions1 Attorney answers: 
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