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View Diary: Is This What It Must Come To To Stop the Banksters? (14 comments)

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  •  "Recourse" states exist in the US too. (4+ / 0-)
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    jpmassar, shrike, Sparhawk, johnny wurster
    Under Spanish law, even when borrowers turn over their homes to the bank, they still owe the entire amount of the mortgage.
    When a lender forecloses on a mortgage, the debt often exceeds the amount that the lender recovers through the foreclosure sale. In states classified as “non-recourse,” the lender cannot seek a judgment against the debtor to recover the deficiency. “Recourse” states allow lenders to seek a deficiency judgment against the debtor.

    It is difficult to classify states as strictly recourse or non-recourse. Almost all states allow deficiency judgments under certain conditions, for certain types of property or foreclosure proceedings. However, many states restrict not only the conditions under which deficiency judgments are allowed but the maximum recovery for the creditors. Based on information compiled by the National Consumer Law Center (NCLC), at least 10 states can be generally classified as non-recourse for residential mortgages: Alaska, Arizona, California, Hawaii, Minnesota, Montana, North Dakota, Oklahoma, Oregon, and Washington. Recent legislation also makes Nevada non-recourse in most cases for residential purchasers for mortgages obtained on or after October 1, 2009.

    State laws also vary regarding the time in which a debtor may redeem a mortgage default. To varying degrees, all states allow debtors to cure defaults before a property is sold through the foreclosure process. However, many states, under various conditions, allow debtors to redeem even after the foreclosure sale.

    -7.75 -4.67

    "Freedom's just another word for nothing left to lose."

    There are no Christians in foxholes.

    by Odysseus on Tue Nov 13, 2012 at 08:11:16 AM PST

    •  In Spain... (1+ / 0-)
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      ...deficiency mortgage debt is specifically excluded from bankruptcy. IIRC, that is not true in any US state and makes buying a property a much more high-stakes affair.

      (-5.50,-6.67): Left Libertarian
      Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

      by Sparhawk on Tue Nov 13, 2012 at 09:19:44 AM PST

      [ Parent ]

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