Foreclosure News

Old foreclosure debt haunting former homeowners

Published: Monday, 01 December 2014
Written by Administrator

They thought losing their home was bad enough. Now, years later, collectors are coming after them for thousands of dollars in back debt. Ben McLarin lived near Jacksonville, Fla., until he lost his job and got divorced in 2007. His wife kept the house, but then couldn't keep up the payments, spurring the bank to foreclose in 2009. This year, a debt collector informed him he was being sued for $115,000, the difference between what was owed on the house and the amount the lender managed to recoup after it sold the home, said McLarin, an IT worker, who now lives in California. His attorney, Chip Parker, with Parker & DuFresne in Jacksonville, said McLarin is one of thousands. Parker estimates that one debt collector alone, Dyke O'Neal, has filed more than 10,000 suits in Florida this year, involving roughly $1 billion in foreclosure debt.

"There are people who lost their homes to foreclosure five to seven years ago, took the credit hit, repaired their score and, just as they were recovering, they take another hit," said Parker.

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A break for some who lost homes to foreclosure

Published: Monday, 01 December 2014
Written by Administrator

Those who have lost their property to foreclosure are capable of buying it back at its current market value, provided that the home is owned by finance giants Freddie Mac and Fannie Mae says the regulator of those firms stated. Before then, the FHFA requires firms to requires that the former property owners pay the whole mortgage that is owed. The FHFA states that the rule can be applied to about 120,000 homes owned by Freddie Mac and Fannie Mae, which grants the majority of mortgages, and were helped by tax-payers in '08 in the recession.“This is a targeted, but important policy change that should help reduce property vacancies and stabilize home values and neighborhoods,” FHFA Director states. The Director has to this point avoided the typee of policies that reduce the debts of those whose properties are worth less than what it owed.

It is sort of an end-run way to do principal reduction,”says an economist...

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