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What happens to the mortgage when a home is sold on tax auction that is still in the owners name but the bank has possession?

Beaverton, OR |

If a bank has possession of a property for greater than a year and the owner of record cannot enter or occupy the property, and it is later sold through an auction, what happens to the debts and the mortgage? And if the owner of record is held liable for the debts is there recourse?

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Attorney answers 3

Posted

You need to talk to a good real estate/foreclosure attorney licensed in the state where the property is located. Your "facts" are confusing, which leads me to think that you might be confused as to title issues.

My best to you.

This firm is in the business of helping people and companies file for bankruptcy protection. Therefore, the bankruptcy code requires that we call our firm a "debt relief agency." This information is provided for general information purposes only and is not intended to be a legal opinion, legal advice or a complete discussion of the related issues. Nor is this advice intended to create a client - attorney relationship. Every individual's factual situation is different and you should seek independent legal advice from an attorney familiar with the laws of your state or locality regarding specific information.

Posted

Your question makes no sense because you would have been able to occupy the property all the way until the foreclosure sale. Also, I would need to know what kind of foreclosure it was (judicial or non-judicial) to know whether or not there is a deficiency judgment. It looks to me that you are concerned about the bank going after you for more money. I need to know more facts. I can arrange a consultation with you if you contact my office by phone or email. 541-476-8825

Asker

Posted

In Oregon it would be a Judicial. The bank changed the locks on the property. My concern is that the bank would take a property that is new and valued at the same amount owed on the mtg. and sell if for significantly less than its value, then sue me or send me a 1099 for the deficiency. The bank won't allow me to enter the property, sell it, or even communicate with me without legal representation.

Christopher L Cauble

Christopher L Cauble

Posted

Well..if you were the owner, you would know if it was a judicial foreclosure because you would have been served with a summons and complaint. And..it the bank can elect to do a judicial or non-judicial foreclosure. The court determines the amount of the deficiency judgment in a judicial foreclosure and there would be a judgment against you. There is only a deficiency if you are not residing on the property or it is non-residential. Your other questions have to do with tax issues that are not related to your other questions. Additionally, you are entitled to speak to the banks representatives even without a lawyer. I think that you are either dealing with unreasonable people or you are confused about your rights. I highly advise you to speak to a lawyer.

Christopher L Cauble

Christopher L Cauble

Posted

Also, the bank could proceed with a non-judicial foreclosure. Banks in Oregon are choosing to move to judicial foreclosures in Oregon due to changes in the law to non-judicial foreclosures that have created more procedural hurdles to banks. In a non-judicial foreclosure, there is no right to a deficiency judgment, but the procedure is generally quicker and cheaper..

Posted

As the other lawyers have indicated, your facts are not crystal clear. Let me guess: if the home is sold by the county or state due to the nonpayment of taxes, the buyer at the auction may buy the property subject to the mortgage. So it just depends upon the facts. It is unlikely that the property owner has personally liability for the mortgage, but you have to read the mortgage to be certain and it is also probably based on Oregon law. So you have no choice but to hire a lawyer in Oregon to hold your hand through this process.

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