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House foreclosed on Bank wants money for difference


Redgrinde
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Our townhouse was foreclosed on between one and two years ago, it has been sold or changed hands at least twice since then. Recently I received a letter from Chase offering to settle the difference from the sale and what we owed. The letter states a difference of around $35,000 and they want to settle for around $7,500.

Some additional info-

Chase held both mortgages.

1st was around 142,000 second 25,000

house value at time of foreclosure around $114,00

listed on the county website as having been sold for around $74,000 then again for around 144,000...

So the question is do I make arrangements with Chase to pay the $7500 they've requested or is there another option?

Tried to keep it brief, thanks.

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I am not familiar with CO laws. When Chase foreclosed did you move out or did you force them to take you to court to evict you?

When they first threatened foreclosure, did you send them a RESPA letter? It looks like you either pay them or try to negotiate with them with an even lesser amount. You could still send them a Qualified Written Request demanding all the documentation that they have from the foreclosure. Last consult with an attorney as to what to do.

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.

Adding my 2 cents - this could be an explanation.....

Colorado is a non judicial state that allows deficiency judgements. The few years after a foreclosure the Lender is looking to collect the difference on what was owed and what the property sold for.

I know of two incidents last year, where a man had his bank account frozen by the courts, after a deficiency judgement was awarded. The other case to a man where the police took a car and furniture; after he did nothing, his deficiency was awarded to the lender.

Looking into this, a chapter 7 bankruptcy was the only way to prevent to deficiency judgement going forward.

If you don't pay - your going to have to weight out if the Lender wants to pay legal costs, to pursue a full deficiency judgement.

Settling for $7500, sounds good. Make sure it is stated - the account is settled in full.

Good Luck..

Edited by 2ndTimeAround
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IMO, the reason these cases don't get pursued 99% of the time is that the lender recognizes that there are no non-exempt assets to pursue and/or the borrower will pursue Chapter 7 protection if there is an action.

So likely, do nothing. And wait out the deficiency SoL. If they sue you prior to that, then seek out a Chapter 7 or settle, but not before. The SoLs are these types of actions tend to be shorter than most other SoLs in most states.

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