Past Debt

What is the name of your state?What is the name of your state? TEXAS
I RECENTLY HAD MY HOME FORCLOSED. I JUST RECEIVED A CALL ASKING FOR 44,000.00. IF I HAD THAT MONEY I WOULD NOT HAVE GONE THRU THE FORECLOSURE. I AM SELF EMPLOYED AND THE COLLECTION AGENCY THREATENED TO COME AFTER THE ONE SMALL THING I HAVE LEFT, MY BUSINESS. IT ISN'T EVEN RUNNING IN THE BLACK. CAN THEY CLOSE MY BUSINESS IF I DON'T AGREE TO PAY THE 44,000.00.

[olgethorpe]

Don't post in ALL CAPS...it looks like you're shouting, and that will upset some people.

Second, its unlikely that the collection agency can take your business. We'll need some more infomation to offer advice, however.

Is your business incorporated? What's the debt for? Is this a credit card debt, or something related to the business?

Was your house taken, or are you still living in it?

[Ladynred]

What is the debt for ??? He said his house was forclosed on and now the bank wants 44K. That means that the sale of the house came up 44K short of what was owed and they want that deficiency amount.

As suggested, they may not be able to take your busiiness, but it all depends on how it's set up - is it incorporated, LLC, sole proprietorship ??

State of Texas

The business is a sole proprietor. No I am no longer in the home. I moved out voluntarily and told them that I could not afford to continue with the payments. There was no court date as I called them and explained the situation. They said they sold it at an auction and the 44K is the balance remaining. My business is a small engine repair shop and parts sales. I am renting the property it is on, so the only real asset is inventory, but there is quit a bit of that.

[JETX]

Okay, lets get you some good answers......

What they are claiming is called a 'deficiency'. That is the difference in what you owed on the loan and what they were able to 'net' from the sale of the property.

1) Your first step should be to request ALL the papers on the property, including your 'payoff' at the time of foreclosure, the costs of the sale and the auction sales price.

2) Did you have PMI (Private Mortgage Insurance) on the loan?? If so, there have been several lawsuits over the mortgage company trying to recover deficiency debts when in fact they recovered from the PMI policy.
The purpose of all this is to try to find out how much you might ACTUALLY owe, if anything.

3) So, lets assume that you have some deficiency in this foreclosure. The lender CANNOT seize any property (other than that with a security interest, the house) without a judgment against you. If you do get notice of a lawsuit, then you might have to worry, until then, don't.

4) And one other thing you should be concerned about.... it is likely that the lender will file a 1099-c form with the IRS reporting your 'deficiency' as income. If they do this, there are some serious tax consequences to their action. One good thing about this though.... if they do file the 1099-c, the forgive any further claim to the deficiency.