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only publishing my interpretation of my situation. You should seek your
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I made my last mortgage payment in November 2007. It is
September 2008 now, and my home has just now gone back to the
bank in foreclosure. It was auctioned on Tuesday at the
courthouse. No one was there, however, to bid on the house so it
went to the bank. I was out of town although I would have liked
to have been there if I could have arranged it just to hear how
much they bid - they probably bid the full amount of the
mortgage ($880,000).
On Thursday a crew of
about five people from Panama City showed up to clean out the
house and change the locks. I had already moved out months
before to a nearby rental condo, but I did stop by to see what
they were doing. It was a very nice conversation with the guy in
charge. He was surprised to find the house in such good
condition as I had been cutting the grass and running the
utilities in hopes that I might sell the house before it ever
reached foreclosure (obviously, that never happened). He said
that most of the houses that they went to were run down and
dirty and often vandalized. That is a shame, but I can
completely understand how people fall prey to their own
resentment in losing a home. I did ask them to leave the lawn
mower and a few yard tools out for me to pick up later.
Everything else in the house they were taking to the garbage,
but that is okay as everything left in the house was to be
discarded anyway. I had just not gotten around to doing it.
What happens now? Well,
things are definitely not over. The bank has to eventually sell
the house in order to pay off the mortgage that I had on it.
Given that no other house has sold in my neighborhood since 2006
even though all of their prices have been cut in half, the house
will probably not sell until at least next year (2009). The bank
will probably list it at a high dollar amount (I will be
watching to see the listing price) in order to get back their
money. This will take a long time for it to sell. If the bank
lists it at a high discount, they will no doubt sell it more
quickly. Which ever way, I am responsible for the mortgage until
it is paid in full with late payment penalties and legal fees
and interest and everything else they tack on to it. Whatever
the house sells for will be deducted from that balance. I expect
to be stuck with a very large deficiency for which I will be
responsible. My lawyer says that they can come after me for the
money in court against all of my other assets even now even
without selling the house first. My lawyer did say, however,
that he thinks this is unlikely. It is more likely that they
will wait to sell the house to see how much they get and then
come after me for the remainder. No matter. Either way, I am
left with far more debt than I will ever be able to pay.
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How will
they come after me? I anticipate that they will take me
to court to get a deficiency judgment and then force me
to turn over assets to them to settle the debt. Of
course, I do not have enough assets to settle the debt
so they will have to then garnish my wages of which they
can garnish up to twenty-five percent (25%) of my net
wages (gross wages less taxes). I expect a hefty six
digit deficiency so they will unfortunately have to
garnish my wages for the rest of my life. Sad, isn't it.
Yes, I am very depressed over the situation. I have not
given up hope though. I am striving every day to come up
with some idea to make a ton of money and pay off this
debt. With all of the things that I am trying, surely
something will pay out. |
What about bankruptcy?
Since I make too much money according to the bankruptcy laws, I
would have to file for Chapter 13 which would put me on a
repayment plan for five to seven years. During that time, I
would have to live according to IRS national standard living
expenses. These national standards are pretty low for me ($211
for food per month; about $600 for rent per month; about $489
for a car per month; etc.). I could not see myself living for
five to seven years on those amounts - not working the job that
I have now. If I had to file Chapter 13 bankruptcy, I think I
would just quit my job and go back to some hourly wage hotel
front desk job with a lot less stress and responsibilities and
wait out my repayment plan.
Wait a minute. Let me
think about that for a minute. I would be able to keep my health
insurance with my current job plus my travel benefits and my
expense account. There might not be a reason to quit my job. I
would still lose my car as it has a monthly lease payment over
the national standard. I would find it very hard to get a
cheaper car though as my credit is now shot. I would be stuck
paying outrageous interest. I would probably have to move to a
cheaper apartment as my current rent payment is over the
national standard. Those two things are very unappealing to me.
I think I will avoid bankruptcy unless my creditors force me
into it.
In the meantime, until
the bank comes after me for a deficiency, I am going to try to
come up some way of repaying the debt. The house has not sold
yet so I am going to concentrate on finding a buyer who is
willing to pay a premium (although it is hard to come up with a
reason for a premium when there are twenty other houses in the
neighborhood which have never been lived in and are half price).
I have got to keep trying.
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