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Purchased the home for $ 468,000.00. House has DEPRECIATED $ 200k since I bought 3 years ago. May is the first month I will not be paying my mortgage.

I want to know, can the bank’s garnish my wages? Will they come after me for the difference, after the property sells? Or will they just make it a wash?

If anyone has gone through this in Riverside County, I would like to hear from you especially the length of time I can stay at my home, before evicition too.

I am just confused, nervous and hate to leave, but I don’t see the housing market going up $ 200k anytime soon.
I read california was a non judicial foreclosure state, in which they CAN NOT garnish wages. that is why so many people are walking away. Plus, it costs the Mortgage company additional money to go after you. Please HELP ME. LINKS OR ANYTHING WILL WORK
tell me if I am right then:


JUDICIAL-THEY WILL ISSUE FORECLOSURE AND SUE. I will have to repay the difference?

What is the Norm. for California?

Also, do they conside the difference between selling and what I owe, Taxable Income?

7 Thoughts on Can the MORTGAGE COMPANY garnish my wages, after a foreclosure? I live in California.?
  1. Reply
    January 13, 2013 at 1:55 am

    You will be responsible for the full amount of the loan. They can garnish your wages, attach your bank accounts, seize your IRS returns…and any other assets you have now or may acquire in the future. You best bet is to try to work with the bank on a short sale or pay until the market increase. As far as eviction goes…usually you will have 30 days after the sheriffs sale.

  2. Reply
    January 13, 2013 at 2:18 am

    Do you have a reason not to pay your mortgage? Did you lose your job? Can you rent a couple rooms to make your mortgage payment?

    Your ability to pay your mortgage is not contingent on the value of your home. You’ve got to do whatever you can to make your payment. From your question it sounds like you think you can walk away without consequence.

    If you go through foreclosure you will owe the difference between the bank’s sale price, and the mortgage you took. And the bank can collect that debt by any legal means.

  3. Reply
    January 13, 2013 at 2:23 am

    The answer to your question about a deficiency judgment is no. Look at your loan docs you signed. They will outline the collateral the lender will attempt to go after in the event of your failure to make you monthly mortgage payments.

    They also will not garnish your wages for any difference that might arise from what you have outlined in your question.

    California is a judicial foreclosure state. Your lender will decide when they will issue a “Notice of Foreclosure.”

    From that date you have 90 days to cure the foreclosure through making up the back payments with your current lender or securing another mortgage with another mortgage company.

    After the 90 days have elapsed or when your lender make the decision you will be issued a “Notice of Sale.” This notice will give you 20 days in which to get another mortgage with another lender. Normally the lender will not entertain the idea of refinancing the mortgage.

    You might contact your lender to see if they can offer you other solutions as oppose to foreclosure. Contact the Loss Mitigation Department.

    Why do you want to stop making payments if you can afford the monthly mortgage payments. It is better than paying rent, because you will be betting the eventually in the next 3-5 years you will start accumulating equity once again. Paying rent you are simply stagnant .

    I hope this has been of some use to you, good luck.

    “FIGHT ON”

  4. Reply
    Dawni Do Right
    January 13, 2013 at 2:36 am

    Judicial foreclosures in Cali are rare. If used, there can be a deficiency judgment.

    Both judicial and non-judicial foreclosure are available, but the non-judicial deed of trust sale is overwhelmingly preferred.

    California has a one-action rule, in which a lender must elect one action to take against the borrower if the borrower defaults. If the lender forecloses the deed of trust out of court, the lender has chosen one action and may not bring a lawsuit to recover a deficiency, which would be a second action. If the lender chooses to sue the borrower and obtain both a foreclosure order, and if the proceeds of the judicial sale of the real estate are not sufficient to repay the loan balance, then a deficiency for the balance is allowed. Such a suit is permitted as the lender’s one action.

    California lenders rarely elect judicial foreclosures.
    Debtors may reinstate up to five days before non-judicial foreclosure sale.

    No deficiency judgment is permitted after a non-judicial foreclosure or for a foreclosure on a purchase money loan. If the foreclosure is judicial, a deficiency judgment is allowed if the foreclosure was not a purchase money loan. California’s one-action rule requires the lender to foreclosure and sues for a deficiency at the same time. If the lender elects to foreclose only, it can’t elect to sue for a deficiency later on.

  5. Reply
    January 13, 2013 at 3:06 am

    Take a deep breathe. You are in luck because Congress passed a bill in Jan 2007 that gave the lenders the right to forgive the balance on defaulted mortgages until Jan 2009.

    But first – don’t leave the house. You have time that you could live there, not make mortgage payments, save your money!
    Typically the lender begins foreclosure proceedings by filing a claim at the courthouse with the sheriffs department. The sheriffs dept. scheduled the sheriff sale. Do you realize how many of them they have to do? It takes time. Once the sheriff sale is scheduled, in most cases the lender buys the property for the mortgage amount plus 1 dollar. The property them goes into a redemption period. This is a period of time (different in each state) that the homeowner can pay all monies due the lender and redeem possession of the home. But after the redemption period the lender typically secures the home and hires a Realtor to get it sold.

    So you have time. Take advantage of that time to save some money, because you will need it. Also you could try negotiating a deal with your lender to take care of the property for a fee at the end. Lenders have begun offering homeowners who do no damage the property money once the vacate the premises and leave it in good condition. It is worthwhile to do this.

    I sure wish you the best. It will be hard to keep your head during all of this, but do try. And remember you aren’t the first or only one going thru this. By the time this is all done, there won’t be one person in the US that wasn’t affected in someway financially.

  6. Reply
    January 13, 2013 at 3:21 am

    The odds are 99999 to 1 that your lender will do a NON JUDICIAL foreclosure. If that happens, the home is the only thing a lender can take to resolve your debt. They CAN NOT get any other money for you.

  7. Reply
    suzy home maker
    January 13, 2013 at 4:19 am

    The other lady is right, you can live in the house for up to a year free, and save your money. Get a lawyer and do it the right way, and no one will come after you. My husband and I have been through this, but we did not stay in the house, I hated living in the country too bad to stay. Now after 3 yrs, I have been told I can own again, but I don’t really want to. I am afraid to get stuck anywhere. I saw how hard it was to sell a house, I don’t know if I ever want to deal with that again, and you run the risk of being stuck next to horrible neighbors if you own. It’s just not worth it to me. I like my freedom to go. You never really own anything anyways, your a slave to the bank your whole life.

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