Foreclosure: Should I sue even if I don’t want to keep my home?
We have previously discussed suing your mortgage company before an Alabama foreclosure — but should you consider this if you do not want to keep your home?
Let’s think this through.
- Do you have the right to sue before a foreclosure happens?
- What are the consequences of a foreclosure?
- Can you negotiate a settlement without a foreclosure and still leave your home?
We’ll take a look at each of these.
Do you have the right to sue before a foreclosure happens?
Here is the short version — normally your mortgage will give you the right to sue your mortgage company before the foreclosure. This is a very powerful tool for you to us to avoid a foreclosure.
But why would you want to avoid a foreclosure if you are not interested in keeping your home?
We need to talk about the consequences of a foreclosure.
What are the consequences of a foreclosure?
You see, many people will say, “If you don’t want to keep your home, just let it go back to the bank in a foreclosure.”
Normally this is lousy advice.
When the foreclosure happens to you, bad consequences begin.
You now have a permanent foreclosure on your record.
Your credit reporting will show this for many years.
If the sale does not bring the full amount owed, then you can be pursued for the “deficiency”. This means collection calls. Collection letters. Even being sued years after leaving your home.
And instead of you choosing the time of your leaving, with a foreclosure, the mortgage company will demand that you leave within 10 days of the foreclosure or you will be sued. If that happens, now you have this on your record and a lawsuit against your record and you may owe money damages to the mortgage company.
But what can you accomplish if you sue first?
Can you negotiate a settlement without a foreclosure and still leave your home?
If you can sue and have a judge look at the default and foreclosure, then it is quite possible (likely?) that illegal actions will of the mortgage company will come to light.
So what good does this do you?
It allows you to now negotiate with your mortgage company. You give them a choice.
Everyone can continue to fight and they are now vulnerable to paying the price for breaking the law.
Since they want the house so badly, they can have it. In a negotiated settlement.
A settlement that protects your credit report.
No foreclosure on your record.
Protection from being sued for a deficiency.
Money being paid to you by your mortgage company for their violations of the law.
So you control your exit strategy.
You stop the foreclosure and have a great solution to this problem. It really is a “win win” as the mortgage company gets your home. They must want it badly as they are willing to break the law to get it. So they should be happy.
*They will not be happy but who cares, right? They tried to take your home and instead, you worked it out with them so they get the home and you get all the benefits we discuss above. Good deal!
What should you do now?
First, figure out when your sale date is set.
Second, do you want to keep your home.
Third, strongly consider filing the right type of lawsuit against the right companies so that you can have a judge evaluate whether the foreclosure is proper or not.
Fourth, develop now your strategy for what you are looking to accomplish in the lawsuit. Do you want to stay in your home or are you willing to leave in exchange for a favorable settlement?
Assuming you live in Alabama, call us at 205-879-2447 and ask for Randi Curb. She is our paralegal who helps me with these types of cases. We’ll get started right away helping you evaluate your options so you can pick the best option for you.
Or you can fill out this form and we’ll contact you and send you some free information to help you think through these issues.
Look forward to chatting with you!