by jonmaddux
Strategic Default Consequences
January 26, 2010 in Everything About Foreclosures
When deciding to make the decision to do a strategic default, it is important to weigh the pros and cons. When a homeowner strategically defaults on their home, they are following the mortgage contract that states that in the event of default or non-payment of a mortgage loan, the home shall serve as collateral and the lender has the right to sell the property to get back the money they lent. The lender / bank that lent the money against the home, decided at the time of which the loan was made, that your home was adequate collateral and a reasonable risk. If a homeowner decides that it is in their best interest to default, then the consequences of that decision will be:
1. To give the home back to the lender at the time of the auction, or soon thereafter and
2. Borrower may have 30,60, 90, 120+ days late reported on their credit report.
3. Public notice on credit report of Default
4. Depending upon state laws, exposure to a deficiency judgment
(A personal judgment against the borrower for the remaining balance on the loan after a foreclosure sale.) READ MORE ON STRATEGIC DEFAULT CONSEQUENCES HERE
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