What should I do to prevent foreclosure on my home? 22 Answers as of July 08, 2013

My mom signed a loan for a house for my sister and brother in law. My sister lost her job and can't pay for the loan and it might be going into foreclosure. My mom also has a house that she lives in which is 3 payments away from being paid for and would like to know how to protect her home and herself from financial ruin and loosing her home.

Ask a Local Attorney. 100% Anonymous. Free Answers.

Free Case Evaluation by a Local Lawyer: Click here
Burnham & Associates
Burnham & Associates | Stephanie K. Burnham
Your mother need to seek legal advice from an attorney. There may be estate planning tools, bankruptcy tools and other legal strategies that could protect your mother.
Answer Applies to: New Hampshire
Replied: 8/10/2011
Berg & McLaughlin, Chtd.
Berg & McLaughlin, Chtd. | Stephen Snedden
Give me a call on this. There are multiple options such as short sale, deed in lieu of foreclosure, etc.
Answer Applies to: Idaho
Replied: 8/8/2011
Theodore N. Stapleton, PC
Theodore N. Stapleton, PC | Theodore N. Stapleton
Your sister could file a bankruptcy to stop foreclosure on her house if she qualifies. Your mom needs to call me to discuss shielding her assets from a suit on any deficiency from a foreclosure/default by your sister. I am happy to discuss these and any other questions you have.
Answer Applies to: Georgia
Replied: 8/8/2011
Lake Forest Bankruptcy
Lake Forest Bankruptcy | Anerio V. Altman, Esq.
She needs to see an attorney NOW. She needs to take action before things get worse.
Answer Applies to: California
Replied: 8/7/2011
Breckenridge and Walton
Breckenridge and Walton | Alan D. Walton
It does not sound like your home is in peril. Your mother needs to pay her mortgage to keep her home. It is rare that your sister's lender would go after your mother after it forecloses on your sister's home.
Answer Applies to: Michigan
Replied: 8/7/2011
    Mankus & Marchan, LTD
    Mankus & Marchan, LTD | Tony Mankus
    If your mom was a co-signer on a loan to your sister and brother in law, or even if she was just a guarantor, she is legally liable for any balance left after foreclosure on the sister's home. If the bank gets a judgment against your mother for the balance due, it can pursue collection efforts against your mom - maybe even foreclose on your mother's home if they record a memorandum of judgment against her property. You should consult with an attorney to see if there is any way to protect your mother's equity in her home.
    Answer Applies to: Illinois
    Replied: 8/7/2011
    Law Office of John C. Farrell, Jr.
    Law Office of John C. Farrell, Jr. | John C. Farrell, Jr.
    With respect to the house your mother has owned for years, I am assuming that it is her primary residence. You should check to see if a Homestead was filed at the registry of deeds. This affords protection against creditor claims. With respect to the house she bought for your sister, mom's credit is going to take a hit. I would also get a copy of the deed to see how the title is held. In this case it would be either tenants in common or joint tenants. Different rights of ownership attach to each one.
    Answer Applies to: Massachusetts
    Replied: 8/7/2011
    Edward Papa, Esq.
    Edward Papa, Esq. | Edward Papa
    There are many options and strategies in regard to this situation. The home being foreclosed up will likely end up selling for less than is due. The foreclosure may lead to a deficiency judgment which would likely be filed against your mother's home leading to wage garnishment and/or bank account freeze. She or her estate would face satisfying the judgment on refinance/sale of the home. And there's the damage to her credit score and report from the foreclosure. Your mother should seek out a consultation with an attorney in her area who can advise her.
    Answer Applies to: New York
    Replied: 8/6/2011
    Ashman Law Office
    Ashman Law Office | Glen Edward Ashman
    Your mom likely ruined her financial future when she cosigned the loan. If the lender sues her, and they may, they can seize her home, wages and bank account. She should see a lawyer but her options are minimal. She should have seen one before cosigning and she would not be in trouble now.
    Answer Applies to: Georgia
    Replied: 8/6/2011
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    ouch..... see a lawyer ASAP. Your mom is entitled to a homestead exemption.... How much depends on her age and whether or not she is disable. Also...... if the loan on the house that is being lost is a purchase money loan (as in it was not refinanced) there will be no balanced owed on that house after foreclosure. If they took out a second mortgage, after it was purchased, and if you mom signed for that loan, she would be liable for it. Lesson here: NEVER CO-SIGN.
    Answer Applies to: California
    Replied: 8/6/2011
    Law Office of Maureen O' Malley
    Law Office of Maureen O' Malley | Maureen O'Malley
    She should pay the last 3 payments on her own house first. Can she do it? If not, surely someone can come.to her aid- family, friends, a church. Is there room to take in a roomer? Or maybe a lawyer could try a modification where those payments are forgiven. I'd hate to see the house be lost now. She may have to file.bankruptcy if she's liable on your sister's house. But again, she should pay HER OWN FIRST.to save.it. Feel free to call me so I can ask.who the lender is and how much the payments are, etc.
    Answer Applies to: Virginia
    Replied: 8/6/2011
    Melinda Murphy Dionne, PC
    Melinda Murphy Dionne, PC | Melinda Murphy Dionne
    I am sorry for the trouble that your family is experiencing. If your mother signed the note for your sister's house she will be liable for any deficiency that results from a foreclosure. Your mother needs to set up an appointment with a skilled bankruptcy attorney to discuss how to protect her assets. It may be necessary for her to keep your sister's house out of foreclosure until your sister is able to begin making payments again. Your mother has substantial equity in her home and she needs to know how to protect her assets. Whatever she does, it is imperative that she NOT transfer her home out of her name for less than its fair market value.
    Answer Applies to: Alabama
    Replied: 8/6/2011
    Eranthe Law Firm
    Eranthe Law Firm | Cate Eranthe
    This should be a warning for others tempted to sign on a loan. Your mom should record a homestead declaration to help protect her home. This form can be found online or in the stationary store, just be certain it is for California property. Some counties have the form on the county website. Look at CCP 704.730 for the dollar amount of the exemption. It depends on a number of factors that are not included in your question. Regarding the home in foreclosure, consult with a knowledgeable local attorney. You may have defenses or available remedies that could slow down or stop the process.
    Answer Applies to: California
    Replied: 7/8/2013
    Ross Smith, Attorney at Law
    Ross Smith, Attorney at Law | Charles Ross Smith III
    Where is Superman when you really need him? Maybe a little information can help. First, it takes between 7 and 12 months to complete a foreclosure in Ohio, depending on your county. During that time you live, eat and slee Second, money talks and nothing else works when it comes to foreclosures. Perhaps the best defense is for the family to rally around Mom and collect up enough financial support to bail out this mortgage. If all the family chips in, maybe you can get this mortgage current and keep it current 'til your sister gets another job at last. If this is not possible, Mom may want to consider a Chapter 13 Bankruptcy plan. She could file a plan to take over your sister's mortgage and pay it as soon as her own home is paid for in 3 months. The Bankruptcy would the foreclosure from going on as long as Mom pays it. She can take her time catching up on the arrearage. Go see an experienced Chapter 13 attorney. Good luck!
    Answer Applies to: Ohio
    Replied: 8/6/2011
    The Law Offices of Mark Wm. Hofgard, Esq.
    The Law Offices of Mark Wm. Hofgard, Esq. | Mark Hofgard
    First of all, the lender on the loan for which your mother co-signed for your sister can only foreclosure on the home that is collateral for the loan. This is your sister's home, unless your mother also agreed to put up her home as additional security for the loan to your sister. The lender can foreclose on your sister's home, and if the foreclosure sale does not result in a price equal to or exceeding the amount due (principal, accrued interest, attorneys fees, and more), then a deficiency may be taken. If there is a deficiency, the lender could then pursue other assets, including your mother's home and assets. Your sister should immediately contact the lender or loan service and apply for a Home Affordable Mortgage Program loan modification and inquire as to other foreclosure avoidance alternatives. Since she lost her job, she has a "hardship" within the meaning of the HAMP regulations. The lender or service will ask for supporting documents, including an affidavit and certain financial information. If she initially qualifies, there will be a Trial Payment Plan (TPP) of three months during which payments are set at 31% of income. During the three month TPP, the lender/services is to evaluate the homeowner for permanent modification. Factors include verifiable income, the amount in arrears, the Net Present Value of the home, and whether a payment can be set that is within the guidelines. If your sister does not qualify for a HAMP loan, she may still be eligible for a Home Affordable Foreclosure Alternative (HAFA) deed-in-lieu of foreclosure. FHA or government insured loans are not covered under this either HAMP or HAFA. The HAFA program provides for deeding the home to the lender/servicer without foreclosure and without a deficiency. Sometimes the homeowner can obtain moving expenses up to $3000.
    Answer Applies to: Colorado
    Replied: 8/6/2011
    Heupel Law
    Heupel Law | Kevin Heupel
    The only way to save a home is to file Chapter 13 bankruptcy. A chapter 13 allows your mother to repay the missed mortgage payments over a three to five years period, and more importantly, it stops the foreclosure. Please call our office at 303-955-7570 to learn more information on how a Chapter 13 would work.
    Answer Applies to: Colorado
    Replied: 8/5/2011
    Carballo Law Offices
    Carballo Law Offices | Tony E. Carballo
    The good news is that if the home only has one loan
    Answer Applies to: California
    Replied: 8/6/2011
    Bankruptcy Law office of Bill Rubendall
    Bankruptcy Law office of Bill Rubendall | William M. Rubendall
    I you co-sign for a real estate loan and there is a default you will be liable for it. If you own other property, such as a residence, you should file a homestead to protect equity up to the amount allowed by state law.
    Answer Applies to: California
    Replied: 8/6/2011
    Colorado Legal Solutions
    Colorado Legal Solutions | Stephen Harkess
    Unfortunately, your mother is learning how risky cosigning for a loan is. Your sister is primarily responsible for the debt and your mother can always seek to have her pay the debt and protect her from the risk of loss, but if your sister cannot or will not take care of the mortgage, the cosigner will be held responsible. The first issue is whether your sister's house is worth more or less than is owed against it. Ifyour sister cannot pay the mortgage, the house needs to immediately be listed for sale. If it will sell for enough to pay off the mortgage, then your mom will have nothing to worry about. If it won't bring enough to clear the mortgage, then a short sale will clear as much of the debt as possible. The remaining debt may be writtten off, or thelender may seek to make your mother pay it. In that event, your mother will probably need to make some sort of arrangement to pay the rest of the debt so that she can protect her house.
    Answer Applies to: Colorado
    Replied: 8/5/2011
    Ursula G. Barrios Law
    Ursula G. Barrios Law | Guillermo Machado
    First thing is to pay your monthly payments. You can attempt to modify loan through a variety of exsiting programs but none are guaranteed to work. Ch 13 can you help recover late payments but there must eb a steady stream of income to make it work.
    Answer Applies to: California
    Replied: 8/5/2011
    The Law Offices of Kristy Qiu
    The Law Offices of Kristy Qiu | Mengjun Qiu
    The fact that she's only 3 payments away from completing her mortgage payments tell me that the house is definitely not under water. In this case, bankruptcy won't help unless your mother or sister and brother in law can afford to make the payments under a Chapter 13 plan, which would probably be a 100% plan, meaning all her debts will be paid in full (including the loan she took out) over the duration of 3 to 5 years. Without more facts, it is hard to give you a definite answer. Another option would be re-negotiate the terms of the loan with the bank. As far foreclosure defense goes, there is nothing to be done until a foreclosure action is filed against your mother.
    Answer Applies to: Florida
    Replied: 8/5/2011
Click to View More Answers:
12 3 4 Free Legal QuestionsConnect with a local attorney