Archives for February 2010

Does my insurance cover my house when it is vacant?

Check you policy! Most insurance policy’s will only cover a house 30,60 or90 days from the time (they find out) the property was vacated. If you are short selling your house in Highland Utah, Alpine Utah or Cedar Hills Utah, check with your insurance and make sure your covered if you house is vacant.

Many insurance companies do not offer coverage for vacant houses. The ones that do are very expensive. For example a typical $300 annual policy may cost around $2900 annually. Depending on how long you keep the policy that may or may not be manageable.

When a BPO agent or appraiser visits a house during a short sale in Utah they will almost always report back to the lender if the house is occupied by the homeowner, rented or vacant. If the house is vacant the lender might send a notification to the insurance company and the home owner stating the the policy must be updated to reflect vacant property coverage. The insurance company may drop the policy at that point.

If you have a vacant house in Highland Utah, Alpine Utah or Cedar Hills Utah, feel free to call me for a consultation about short sale & loan settlement options.

Should I short sale my house if I am filing for bankrupcy?

Yes, If you want to avoid the chance of a foreclosure public record on your credit. I hear from clients all the time that there BK attorney told me the house would be “included” in the bankruptcy. The debt is included, but the house is still in YOUR name and you are still the owner during and after the BK. The only way they can take title is to go through the foreclosure process and foreclose. If you have filed a BK in Highland Utah, Cedar Hills Utah, or Alpine Utah and need to sell your house, call me today and find out about how to negotiate a short sale after a bankruptcy. Avoid having a BK and a foreclosure on your credit (double whammy) and work out a short sale with your lender. Negotiating a short sale in Highland Utah, Cedar Hills Utah or Alpine Utah is actually easier after a BK because all that needs to be negotiated is a lien release, not a settlement of the debt.

(this is not bankruptcy advise) =)

What does it mean to “Produce the note”?

One way to stall a foreclosure action is to ask your lender to produce the original note you signed to prove that they actually have the legal standing right to foreclose. This does not work as well in Utah because most all loans in Utah were originated using a Trust Deed and Note instead of a an actual Mortgage. This means that most foreclosure actions are non-judicial instead of judicial. So you can send your lender a qualified written request (QWR) and ask them to produce the original note and prove that they have the right to foreclose, but most likely they will just send you a copy of the note you signed at closing. Which most likely is a different lender and not the current owner of the note. This is not the same as proving that they are the legal owner of the note and have the standing right to foreclose but without a judge to hold up the foreclosure sale the trustee will most likely just move forward with the trustee sale at this point. The problem for most lenders is the the note was transferred so many times and stuffed into large pools of loans that they do not have the original copy of the note or they failed to maintain the proper chain of assignment so they are unable to actually prove that they have the standing right to foreclose.

Below is a video by Good Morning America explaining the produce the note strategy.

Another video- Produce the note Utah on Fox

Another video-Produce the note Utah on CNN

How long does a bank have to pursue a deficiency judgment after foreclosure in Utah?

A question people always ask is ” Is Utah a deficiency state?” The answer is yes. Another common question “How long does a bank have to purse a deficiency judgment after a foreclosure in the state of Utah?” This is question has a very interesting answer. I am not an attorney, but I talked with an attorney today who specializes in mortgage law and foreclosure law and he said that if a first mortgage forecloses they only have 3 months to take action and pursue a deficiency judgment in Utah. The 3 months begins the day the trustee sale takes place and is limited to the lender who takes the foreclosure action. So if there is a second or third mortgage lien that is wiped out by the foreclosure action of the first mortgage, they can still collect up to 6 years (may be less ask attorney about specific situation), or sue for a deficiency judgment for up to 6 years, but the foreclosing lender only has 3 months. First they must establish the deficiency amount by determining the fair market value of the property through on appraisal on the day of the sale and then sue, win and receive the judgment for the deficiency.  I found a couple of links that support what he told me in the Utah code and posted them below. (OK he told me where to look 😉

http://le.utah.gov/~code/TITLE57/htm/57_01_003200.htm

http://le.utah.gov/~code/TITLE57/htm/57_01_003400.htm

If you live in Utah County or Salt Lake County and would like to know what you options are to stop foreclosure and settle your mortgage debt please contact me.

Remember- Do NOT rely on this information regarding your specific situation. Please call an attorney or me for a reference.