Posts Tagged ‘arizona foreclosure’

Question:  We have a deficiency judgement against us for a home we were building in Arizona. Can the bank garnish my wages and/or lien the house in which we reside. We do not want to file BK?

Answer:  – First off let’s clear up some misunderstanding on your deficiency judgment in Arizona. Arizona is actually a non deficiency state, however there are rules in order for the homeowner to apply the anti deficiency law. First is has to be a residential property on less than 2 1/2 acres. If you only have a first mortgage, chances are you may qualify. It’s the 2nd or HELOC that gives homeowners in Arizona all the problems. Usually a deficiency judgment in Arizona happens because of a HELOC since it is taken out after the 1st mortgage and it’s not a purchase money loan.

With this in mind, you need to determine what your situation is and if they have grounds to file a judgment against you based on what you’ve just read. If they can file a judgment against you than it’s best to try and work something out with the lender if you can. Usually you can make them an offer to pay it off in full or work out a payment plan. A lot of times homeowners don’t have a choice but to file bankruptcy because the lender simply won’t work with them and they can’t afford the payments or lump sum. But definitely try to settle with them if you can. If you do nothing, yes, they can garnish wages if it gets to that point.

Question:  Our house was foreclosed in Arizona on a little over a year ago in AZ. But we are still getting (and paying) the bill for a Home Equity Line of Credit we had on the same property. Is there anything we can do to reduce or eliminate this bill since we were foreclosed?

Answer:  -Yes, if I understand you correctly, you are making the same payment on your HELOC as you were before the auction. Usually in a situation like this, most homeowners will settle with the bank for a smaller amount and create some sort of payment plan to payoff the note within a short time. Another option is to file bankruptcy and wipe it out completely. This is the main reason why banks will usually work with you in finding a solution because they would rather have some money instead of no money. Hope this helps.