Private Mortgage Insurance Sue Homeowner?Posted by Cat Nguyen on Feb 18, 2013 | Comments Off
Can the PMI company sue a home owner that completed a short sale or was foreclosed on?
Many homeowners think that the Private Mortgage Company (PMI) company is something that protects the homeowner. The PMI that is paid by the home owner is actually a insurance that covers the lender in the event if you default on the loan.
There are more and more lawsuits being filed from the PMI company against the home owner that was in default. Even though a short sale is completed there can still be a deficiency. A lot of the deficiency could come from the 2nd lien holder that had to take a bigger loss when a short sale was completed. The lender can claim the loss with the PMI company for their loss that they had incurred when they completed the short sale or if the house was foreclosed on. The PMI company can stand in your lender’s shoes to try to collect the money back from you, a legal concept known as “subrogation.”
You may request the PMI company to show proof that they have the right to go after you for the deficiency. This is why it is critical to find out if your lender will waive all rights to go after you for any types of deficiency after the property has been sold. Please speak to a attorney or a qualified RealtorShould I buy a Dallas Short Sale?. Read more ... » when you are thinking about short selling your house or facing foreclosureShould I buy a Dallas Short Sale?. Read more ... ».
You have options. Make sure you explorer all options because this can affect your future for quite some time. Please contact us for any questions you may if you are facing foreclosure. We can help! JC & Associates
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