debt collection after foreclosure

[flora maestas]

What is the name of your state? nm

I lost my home through foreclosure in March of 2004.
I do not know whether the Mortgage Company bought it back or someone else. In any case, I just recently received a letter from a collection agency on behalf of the mortgage company trying to collect $ 39,000.00. At the time of foreclosure, I owed $55,000.00 on the house, so I am assuming they sold it for far less than market value and are trying to collect the difference. I have two ?'s, I read my mortage and it said nothing about the mortgage company being able to collect anything other than legal expenses and other costs involved, in the event of foreclosure. Are they entitled to collect this money as well as take the house? Also, can they sell it for less than is due them as well as less than market value? If they were willing to take such a loss, why wouldn't they reduce my payments or work with me? I could have probably kept the house.

[cmorris]

They take the house to try and recoup some of their costs. They will sell it at auction to get rid of it faster. You get to pay the difference, plus all of the fees. Sorry, but that is the way it works.

Obviously, it is still within the statute of limitations. However, write a letter certified mail return receipt asking for a break-down of the accounting. This just ensures that you will pay the correct amount. Then try to come to a payment agreement or settle with them. IF you do settle, make sure they cannot sell the unpaid portion to another collection agency.

As another option, you might want to consider BK. $39K is a lot of money. Most people also have other debts (medical or credit) that you could also get rid of. For that much money, I would be worried about getting sued.

Best of luck to you.