You have some options. For example, you may consider a deed-in-lieu of foreclosure, in which the bank agrees to accept a return of the property as payment in full of the balance. Once the property is transferred, your obligation to pay future HOA fees ends. However, you should review any deed-in-lieu with an attorney to make sure the mortgage lender is waiving any deficiency judgment.
Another option, if you qualify, is to surrender the house and discharge the deficiency on whole or in part in Chapter 7 or Chapter 13 bankruptcy. In the alternative, it is sometimes possible to reach a negotiated settlement with the bank to waive the deficiency or accept a much smaller amount than the balance. You may wish to discuss your options with a local foreclosure defense and bankruptcy attorney.
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If the judgment is transferred to PA (an easy task) the lender can pursue your assets here in PA. Your IRA is generally safe.
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James S. Tupitza
212 West Gay Street
West Chester, PA 19380