Obama's Economy

Can the bank require that I pay the balance of my mortgage following a “short sale” that is below what I owe?

My home is in foreclosure and my realtor has a buyer willing to buy the home at a price agreed on by the bank. Initially the realtor told me the balance of what I owe would be “forgiven” by the bank. Today she informed me that the bank requires I sign a form indicating my continued responsibility for the balance. I’m 65 and unemployed, currently receiving social security, a minimal monthly retirement payment, and unemployment compensation. My future employment prospects are bleak. I cannot afford to pay off the balance. The home is scheduled for a sheriff’s sale in a few weeks. The bank will receive much less after a sheriff’s sale than they would if they agreed to the short sale without requiring the balance from me. Should I now consider filing for bankruptcy? Do I have any other options? I would appreciate any advice. Thank you (frustrated grandpa of 13)

I agree that you need professional advice (as smart as we all are on Yahoo! answers, most of us are not attorneys).

You have stated that you are unemployed and unlikely to be able to pay anything back. I would not agree. Your realtor is going to push you to sign because they want the commission of the sale. Your buyer is going to push you to sign because they want the house. Your bank will push you to sign because they want the money. You need to do what is best for you at this point.

Get professional help on this decision – you need to contact a lawyer and a tax professional. I’d start with the lawyer. See if you can find one that does some ‘pro bono’ (free) work for seniors. Even if you need to pay – a few hundred dollars now might really save you in the long run.

good luck!

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