Dave Halpern Louisville Short Sale Expert (502) 664-7827

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Foreclosure and Divorce in Louisville – Beware When One Spouse Gets The House and The Other Gets The Mortgage

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When the divorce agreement awards the house to one spouse and the mortgage obligation to another, this could spell great peril. The spouse in the house often doesn’t know if the “mortgage spouse” stopped making the payments.

The billing address usually gets changed to the mortgage spouse’s new address. The spouse in the house does not get any late notices about non-payments until it’s too late.

Even though house spouse can claim that the mortgage spouse is in contempt of the agreement, the damage is already done. The back payments and legal fees often make it too hard to catch up and cure the arrearage.

The house is now headed to short sale or foreclosure. Foreclosure often leads to bankruptcy.

So what should be done if you are a spouse that got the house?

  • You still have the right to call the lender every month to confirm the payment was made.
  • You have the ability to check the payment history online.
  • You may also call your lender to determine what other early alert systems they have. Can they email you late notices? Can they mail you duplicate billing statement copies?

You don’t want to be totally blindsided about the arrearage when the sheriff knocks on your door to serve you with an unexpected foreclosure lawsuit.

Dave Halpern

Real Estate Broker, Louisville Short Sale Expert Realtors

(502) 664-7827


Sellers looking for foreclosure help in Louisville, KY should call Dave Halpern, Realtor, Louisville Short Sale Expert Realtors, (502) 664-7827.

I will provide detailed information about foreclosure options and short sales. We help dozens of sellers avoid foreclosure every single year in Louisville, Jefferson County, Oldham County, Bullitt County, Shelby County, Nelson County and Spencer County.

We can help. You have options. Call even if you think your house isn’t sellable. Many testimonials available.



Bank Of America Inflicting Short Sale Losses Upon Itself

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Bank Of America’s policies for processing short sales are short-sighted and will cause countless millions of dollars of unnecessary losses that could have easily been avoided. BOA threatens the seller that they can be pursued with a deficiency judgement if a short sale is approved.

Millions of homeowners who have unbearable ”upside down” mortgage are turning to short sales to sell their house. In a short sale, the lender accepts an amount short of the payoff and usually forgives the deficiency. Lenders nationwide have realized that accepting a short sale settlement now is more profitable than spending a year foreclosing on house and taking ownership of an abandoned house in unknown condition in a declining market while paying taxes, insurance, maintenance and utilities.

The seller’s primary motivation is to get out of debt and avoid foreclosure and possible bankruptcy.  A short sale is much more labor intensive for the seller than just living in the house for free for a year until the foreclosure auction. The seller is doing the lender a favor by working the short sale and helping the lender reduce its losses. In return, the lender usually forgives the shortage. Not out of kindness, but out of self-preservation. If the lender doesn’t make that concession to the seller, why should the seller go through the short sale hassle? Why should the seller pay rent somewhere when they could live for free for many months or a year or more?

Enter the brilliant decision makers in Bank of America. BOA has imposed strict rules insisting that borrowers that do them the favor of a short sale are threatened with the possibility of being pursued for a judgement. The exact language; “BAC Home Loans Servicing, LP and/or its investors may pursue a deficiency judgment for the difference in the payment received and the total balance due, unless agreed otherwise or prohibited by law, if the short sale closes on the reference loan above.

Here is what sellers are saying to Bank of America:

“Screw that! If you won’t work with me I’ll just stay here and file bankruptcy the day before the foreclosure auction, then live here yet another six months at your expense.”

Or, “Screw that, I’ll abandon the house and let it rot to the ground and file bankruptcy on the deficiency.”

Here’s what Realtors who specialize in mitigating bank’s losses by working the labor intensive short sales are saying; “I’m boycotting BOA short sales. No way I’m going to put up with BOA’s inefficient short sale processing for 6 to 12 months just for them to strong arm the seller into bankruptcy. All my work on the short sale listing will evaporate and the house will go to auction.”

Agents representing buyers who make offers on short sale listings are already inquiring if the foreclosing lender is BOA. If it is, they refuse to make an offer and they just move on thereby leaving another loan to continue to bleed on the BOA balance sheet.

The executives on the BOA golf course will never make the connection between their self-destructive policies and tens of millions or hundreds millions of unnecessary losses. For the sake of homeowners and the economy in general, let’s hope that someone in BOA figures this out.

— Dave Halpern is a Real Estate Broker in Louisville, Kentucky. His company, Louisville Short Sale Expert Realtors closes dozens of short sales per year. Dave can be contacted at (502) 664-7827 and by email dave@LouisvilleShortSaleExpert.com