Saturday, October 1, 2011

Banks Collecting Mortgage Loan Deficiencies After Foreclosures From Borrowers

From The Wall Street Journal"House Is Gone but Debt Lives On" by Jesse Silver-Greenberg:
Forty-one states and the District of Columbia permit lenders to sue borrowers for mortgage debt still left after a foreclosure sale. The economics of today's battered housing market mean that lenders are doing so more and more.

Foreclosed homes seldom fetch enough to cover the outstanding loan amount, both because buyers financed so much of the purchase price—up to 100% of it during the housing boom—and because today's foreclosures take place following a four-year decline in values.


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