If that were to happen then the bank would only be able to take 25% + some cost (strictly defined). The remaining proceeds from the sale would be paid to you.
For simple math let’s say your mortgage is for $100. You have paid $75. You default and the bank takes your home and auctions it off. They get $125 (gotta love how value goes up). They take their $25 + $5 for costs. You then recieve the remaining $95.
Of course this isn’t counting all the interest you’ve paid just the principal.
Part of what made 08 so devastating is many homes were sold at a loss leading to the home owner being left with nothing.
To be clear I’m not saying being foreclosed on is nice in anyway, but there are rules that lessen the blow
When I browsed foreclosures on publicsurplus.com auctions (without intent to buy, only curiosity), those properties looked like they were being sold for next to nothing. Granted, it was as is, cash only, and up to you to remove the occupants (yeah, right), but the price starts were crazy low.
And neither does the bank unless the buyer uses the same lender. You could let them take it if you want, but the equity would probably be useful for any future endeavor.
I think legally I own my house but if I don’t keep paying the bank they can come and take it from me.
Yep. Even if you’ve technically paid for 75% of it, it won’t matter if you stop paying.
If that were to happen then the bank would only be able to take 25% + some cost (strictly defined). The remaining proceeds from the sale would be paid to you.
For simple math let’s say your mortgage is for $100. You have paid $75. You default and the bank takes your home and auctions it off. They get $125 (gotta love how value goes up). They take their $25 + $5 for costs. You then recieve the remaining $95.
Of course this isn’t counting all the interest you’ve paid just the principal.
Part of what made 08 so devastating is many homes were sold at a loss leading to the home owner being left with nothing.
To be clear I’m not saying being foreclosed on is nice in anyway, but there are rules that lessen the blow
When I browsed foreclosures on publicsurplus.com auctions (without intent to buy, only curiosity), those properties looked like they were being sold for next to nothing. Granted, it was as is, cash only, and up to you to remove the occupants (yeah, right), but the price starts were crazy low.
Most I’ve seen were auctions
To be fair at that point they’re more likely to come take your income and give you a tiny allowance
Or you can sell it.
Yeah but then I don’t have a house again
And neither does the bank unless the buyer uses the same lender. You could let them take it if you want, but the equity would probably be useful for any future endeavor.