Can a bank go after other family assetsifwe get forclosed on?

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Can a bank go after other family assetsifwe get forclosed on?

My wife and I are a month behind and don’t see a way to keep making any payments so may have to let it forclose (maybe cash for keys as a option, but the one thing is I know we are about 85k upside down on this house and worried the bank will come after us. My wife is listed as POA on her dad’s bank account for when he dies, and is also listed on her mom’s account to have permission to make deposits and withdraw for her. Can our creditors go after either of her parents if they sue us for the difference?

Asked on March 31, 2011 under Real Estate Law, Idaho

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Creditors can not go after your wife's father's account, since while she has authority over it (in some situations) it is not her account. (After he passes, if she then inherits the money in it, that's a different story; then it will be her money.)

As for her mother's account, that depends on exactly how things are set up. If your wife is considered a joint account holder in some way, then creditors may be able to go after money in that account. Even if at the end of the day they fail to access the money (because your wife is not an account holder), they may try to go after it if your wife's name is on the account. You may wish to discuss with your bank and her mother whether is some other way to get the same affect that will distance your wife more from the account--maybe take her off the account and execute another POA.


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