If my house goes into a short sale or foreclosure, are my bank accounts with social security and pension money deposited in them at risk? 6 Answers as of March 11, 2013

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The Law Office of Darren Aronow, PC
The Law Office of Darren Aronow, PC | Darren Aronow
No, the real estate secures the loan, not your bank account.
Answer Applies to: New York
Replied: 3/11/2013
Underwood & Riemer, P.C.
Underwood & Riemer, P.C. | James D. Patterson
If there is a deficiency balance after a foreclosure, it is possible the bank/mortgage company could come after you for the amount owed. So, for example, if the home foreclosed at $80k and the mortgage was $100K, there would be a $20K balance. If the bank/mortgage company sued for that difference and received a judgment, they could garnish wages or bank accounts. Your pension at that point could be at risk. Your Social Security would be protected. However, the bank may inadvertently turn those funds over as well. We have seen that happen with banks before.
Answer Applies to: Alabama
Replied: 3/11/2013
Law Office of D.L. Drain, P.A.
Law Office of D.L. Drain, P.A. | Diane L. Drain
It depends on the law of the state where you live.
Answer Applies to: Arizona
Replied: 3/11/2013
Frank Law Group, P.C.
Frank Law Group, P.C. | David E. Frank
Not in California.
Answer Applies to: California
Replied: 3/11/2013
The Law Offices of Mark Wm. Hofgard, Esq.
The Law Offices of Mark Wm. Hofgard, Esq. | Mark Hofgard
If your home is sold at at foreclosure sale, and there is a deficiency (sold for less than amount due, plus expenses), the creditor must obtain a judgment against you on the deficiency before other assets may be reached. The short sale, if approved by the lender, eliminates any deficiency. However, you will have cancellation of debt income that is reported to the IRS, and you must fit within one of the exemptions in order to avoid being taxed on this. The home owner's exemption expires at the end of 2013.
Answer Applies to: Colorado
Replied: 3/11/2013
    Stacy Joel Safion, Esq.
    Stacy Joel Safion, Esq. | Stacy Joel Safion
    A short sale and foreclosure are two different concepts and have different consequences. With a short sale all of the lien holders agree to take less in a sale of your home. They cannot come after you for any more money. In a California foreclosure all purchase money loans are wiped out. They cannot come after you for the balance. However if you refinanced or took out a second later on these loans are NOT wiped out and they could come after you. I am a real estate broker and these is always is a major concern of my clients.
    Answer Applies to: California
    Replied: 3/11/2013
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