CAN I NEGOCIATE WITH THE BANK IF I WALKED OUT ON A PROPERTY?

I walked out on a property because I received a letter that it was going to be sold in an auction, then I received letters that the loan was transferred to another bank. Can I negotiate with the bank for a modification even if I’m not in the house any more? I tried to get a modification with the first bank and they denied the modification due to low income.

Asked on March 8, 2011 under Real Estate Law, Arizona

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

First, the bank doesn't care who lives in the house, or even if anyone does--all they care about is the loan. So not being in the house doesn't matter, IF you are still the owner.

Second, realize that even in the best of circumstances, it's completely voluntary on the part of a lender to negotiate--they don't have to. You can always ask, but they can say no.

Third, if you've already lost the house, it's too late too even try to negotiate--you have no leverage if the home as been foreclosed, since you are no longer the owner and the bank's already got your asset. If the home hasn't been foreclosed, then you can try, remembering that it's voluntary on the bank's part to negotiate or settle; that means you need to make a compelling argument for the bank, such as demonstrating that you'll pay whatever you can, or that the alternative is your declaring bankruptcy, reducing what the bank could potentially get.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.