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Steven Patrick Combs

Steven Combs’s Answers

5 total

  • Can your retirement pension be garnished due to foreclosure - 1st and 2nd mortage involved in Michigan?

    Due to job loss and a pending foreclosure that involves a first and second mortage is a retirement pension and social secuity safe from garnishment.

    Steven’s Answer

    Because I am not a Michigan lawyer, I cannot address your exact question. However, your question is a good question that may help many other folks looking for guidance. So my answer will be limited to whether one should tap out their retirment savings inorder to save a house that will likely end up in foreclosure some time down the road.

    Nearly all retirement accounts that are governed by the Employee Retirement Income Security Act (ERISA, as it is called), including pensions and 401Ks, are not assets of a bankruptcy estate because they almost all universally contain an anti-alienation clause that protects them from the reach of creditors. Due to recent amendments to Section 522(n) of the Bankruptcy Code, Individual Retirement Accounts (IRAs), and other similar retirement savings vehicles, while assets of the estate, enjoy special protection capped at $1 million.

    What does all this mean? It means in most cases, all the money drained from retirement accounts to keep a doomed mortgage out of foreclosure for an extra year, could have survived a bankruptcy. Retirement accounts exist to help you survive in your twilight years. It does you no good to waste these assets to delay an otherwise inevitable foreclosure. If you find yourself in this situation, before draining your 401K or IRA, talk with a bankruptcy lawyer with experience in foreclosure defense about your bankruptcy options and foreclosure defense options.

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  • In the short sale process, why would the bank approve a short sale and then go back and ask the seller for more money?

    Seems to me that the bank is greedy and wants more money after having already agreed to let the seller go through the short sale process, requiring a hardship letter, finances, tax records etc. Is it because they know what funds he has in the acce...

    Steven’s Answer

    It is not clear from your question whether or not the bank is coming to "the seller for more money" after the short sale is complete. If the bank is, this means that the seller failed to ensure that the short sale agreement provided for a waiver of the deficiency as a condition for the sale. That is, the seller failed to make sure that the bank approved the short sale with an express and written understanding that the bank would not come back later for the difference between what was owed on the mortgage note (which could include foreclosure costs, interest, late fees, etc.) and the amount of the money that the bank realized from the short sale (after deducting closing costs and commissions).

    What some people fail to realize is that the approval of a short sale merely means that the bank is agreeing to release there security interest in the collateral -- your house -- in exchange for taking what money it can get from the sale of the collateral. It is up to the borrower to try to negotiate that what money the bank receives is accepted as payment in full. I constantly am advising my clients contemplating short sales to make sure that all parties are on notice, starting with the listing agent and spelled out in the listing agreement, and continuing through to the Purchase and Sale Agreement, that the property will only be sold contingent upon the bank accepting the sale's proceeds as payment in full, even though the payment is less than the amount owed on the mortgage loan. More on this short sales topic can be found on the FAQs of my website.

    THESE COMMENTS ARE NOT LEGAL ADVICE. They are provided for informational purposes only. Actual legal advice can only be provided after consultation by an attorney licensed in your jurisdiction. Answering this question does not create an attorney-client relationship or otherwise require further consultation.

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  • Is it legal for the landlord to accept rent from tenant while unit is in foreclosure and the Maintenance fees have not been paid

    The unit has been in the process of being foreclosed. No one has been living in the unit for 5 months, but now someone wants to stay as long as possible and pay rent. Maintenance fees have not been paid for 5 months. Is it legal for landlord to ac...

    Steven’s Answer

    To supplement Mr. Tuttle's answer, under the Tenants at Foreclosure Act of 2009, the tenant must be a bona fide tenant. Some lawyers believe that this means that the tenant must be current in their rent. Others believe that whether one is a bona fide tenant must be decided by the trier or fact in each case.

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  • What can I do to get rid of a debt (Home that I lost through foreclosure) I can not pay?

    My home was foreclosed (final) a year ago. I had listed prior to the foreclosure- with a licensed Real Estate Agent who said she was going to list for a Short Sale. The listing ran out and nothing had happened- went into foreclosure process- and...

    Steven’s Answer

    As previsoulsy stated, Bankruptcy is the obvious answer. There are two priniciple types of bankruptcy for your average consumer. The simplest one is called Chapter 7 and in the simplest terms your assets, to the extent you have any, are liquidated and your debts are discharged. The more complex alternative is Chapter 13. In Chapter 13, your debts are reorganized and you pay off all or a portion of your debt within three to five years. Because of past abuses of the bankruptcy code, only certain debtors are allowed to file for Chapter 7 Bankruptcy. If your income is below the median for your geographic location and you do not own an appreciable assets, the Chapter 7 is a viable option for you. There is no substitute, however, for speaking with a bankruptcy lawyer to discuss the intricasies of your case.

    As to the annoying telephone calls, if the company calling you is a debt collection agency that is separate from the creditor to whom you owe the debt, you have certain rights under the Fair Debt Collections Practices Act. You should ask your bankruptcy lawyer to explain your rights during your initial consultation.

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  • Florida,I have a condo that is in foreclosure and we are working with the lender.

    The lessee never pays the rent on time and he never pay me late fee. june month it was never pays. We put in his door, 3 days notice. What I can do now? Can I sue them for the rest of the lease agreement plus late fees and rent he never pay?...

    Steven’s Answer

    You can sue for eviction. However, if you have been collecting rents without paying your mortgage, and if the lessee hires an experienced consumer lawyer, the lessee could defend the action on the basis that you have breached your lease with the lessee by allowing the property to go into foreclosure. If you leased the premises while the property was in foreclosure, the lessee could assert fraud in the inducement. Our local legal aid society has succesfully fought evictions where the property was in foreclosure.

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