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    Renting & Real Estate

    Question

    I foreclosed on my house last year and the bank sold it for more than we owed,but say we still owe everything?
    They sold it for about $12k more than what we owed. We were told we'd even get any extra money back. But now, they say even since they sold it, we owe them every cent from the foreclosure. Can they do that?
    5 days ago 7 Answers

    Best Answer

    Chosen by Asker
    If the bank foreclosed on your house and a sale produce more than the loan you had on the property plus any attorney and foreclosure fees and real estate sales commission then you are entitled to the overage. This is normal and often the case. Most house that are foreclosed on do not normally exceed the loan amount thus the bank have to take a loss on the property. If the bank has a loss, the IRS has came to the conclusion that someone had a gain. Since you lived in the house prior to the foreclosure the IRS has come to the conclusion that you had the gain. The lender will send you a 1099 indicating this gain. You will have to pay federal taxes based on this gain. You should contact a tax consultant upon receipt of this 1099 from your former lender. I hope this has been of some use to you, good luck. "FIGHT ON"
    a few seconds ago

    Other Answers

    • Once the lender took title to property you get zero even if they can sell it for more than loan. It was their house at that point. You can bet they sold it after expenses for less than you owed. Their costs to sell the home were far in excess of $12,000. I think legally they can come after you for the differnece, but that is very unusual. They sure cannot come after you for your entire loan balance.

      by David Z - 14 hours ago

    • In a foreclosure you forfit all rights to the property or any equity in the property.

      by physicist - 14 hours ago

    • glad you got an answer from the attorney.

      by DeeDee - 14 hours ago

    • We had perfect credit before my husband lost his job, while I was pregnant. We had to move to a different state for a job and were forced to let the house go into foreclosure. We had to file for bankruptcy in order to keep from paying a "deficiency judgment". I can't imagine being forced to still pay off the loan! Good luck.

      by Olivia - 14 hours ago

    • Your additional details section is all wrong. But that is not the case here. Maybe you think they sold it for $12K more than you owed, but as has already been pointed out here there are a LOT of expenses involved in processing a foreclosure. What exactly are they saying you owe? Not the amount of the full mortgage, I'm sure.

      by HEATHER - 14 hours ago

    • There are 2 transactions here. 1. the bank foreclosed, which means they became the owner of the house. At this point, almost all the time there is going to be a loss for the bank. They would never take it back for more then you owe. Plus you have late payments, late fees and lawyer fees AND the amount of the loan. This is what you owe the bank. 2. Now the bank is the actual owner of the property. What ever they sell it for, profit or loss doesn't effect you. TALK WITH A LAWYER.

      by Real Estate Guy - 14 hours ago

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