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Arizona anti deficiency

Arizona rental foreclosed on

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Question:  I live in California but owned a rental in Arizona that was foreclosed on. I had an equity line of credit on that home when it was foreclosed on. I believe I owed about $90K on that equity line of credit. Can they now come after me for the money? Is my only recourse bankruptcy?

 

Answer:

Well all you can do it wait and see what the bank sends you in the mail. They will either send you a 1099 or they will send you a judgment for the $90k. Now, I know that Arizona is a anti-deficiency state, however, there are 2 statutes that apply to foreclosure and in a lot of cases, homes that have 2nd mortgages do not fall into the category of either of these statutes because the money was not used in the purchase of a home. You might be able to work out a settlement with the bank especially if you threaten them with the bankruptcy card. A good attorney can help you with that. Worst case, most people just bk.

I wish you would have found us earlier… you could settle your note as well and save a lot of headache. Good Luck

Arizonas (anti-deficiency state) law when foreclosed on

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Question: I have a home in Arizona [anti-deficiency state] that was purchased with an 80/20 loan. I have never refinanced the loans. We were in the process of negotiating a short sale, got approval from the first [with Country Wide] and they agreed to pay the 2nd [Citi] $3k, when we went back to Citi to get final approval we discovered that they charged off the 2nd and sold the loan to a subsidiary which has now turned it over to an attorney that claims they are going to file a deficiency judgement against me and collect the debt. They claim that since it was a second mortgage and it was charged off that they can do this. It was a second but it was a “purchase money” loan. Can they come after me for the deficiency?