Question
State: Florida
Problem: Parent passed aware with an inverted mortgage (i.e. owes more than house is worth). Children are being sued in order that bank can foreclose on the property, which the children (heirs) have no interest. No one other than the parents signed the mortgage.
Now, the suit names all the heirs, which I guess is expected. However, section "E" of the complaint has a section for DEFICIENCY JUDGEMENT which has the children concerned.
WHEREFORE, Plaintiff, , prays:
a) This Court take jurisdiction of this cause, the subject matter and the parties hereto;
b) The Court determine the amounts due to Plaintiff from Defendants and that such
amounts be declared a lien upon the subject property;
c) The Court enter a judgment foreclosing the mortgage lien, and, upon the
Defendants' failure to pay the amounts due to Plaintiff by a date certain, that this Court order that
said real property be sold in accordance with the law and practice of this Court so that Plaintiffs
mortgage lien is satisfied;
d) The Court determine that the Plaintiffs interest is superior to the rights, title and
interests of the Defendants named herein or any other person or party claiming by or through or
under them since the filing of the Lis Pendens and that the rights, title and interests of said
Defendants be absolutely barred and foreclosed;
e) If the proceeds of the sale are insufficient to pay Plaintiffs claim, the Court grant
Plaintiff a deficiency judgment, unless any defendant who is personally liable shall have been
discharged from liability under the subject note pursuant to the provisions of the United States
Bankruptcy Code;
f) This Court retains jurisdiction of this action to make any and all further orders and
judgments as justice requires, including but not limited to, the issuance of a writ of possession.
The problem is that we dont care of they foreclose, but we dont want a deficiency judgment against us. How is that even possible when it was the parents mortgage and the children never cosigned?
Answer
Only those named as holders (including co-signers) of the mortgage will be liable for any deficiency judgment or any other liability related to the foreclosure. Foreclosures often
name any related party including renters, grantees of easements, and others as
part of the foreclosure process. Children might be sued as possible beneficiaries of
an estate which included the property. Regardless, the children should not be
concerned about a deficiency judgment.
Answer
I would also be concerned.
