If I was unable to continue paying my home mortgage, besides foreclosure could the bank attempt to seize my other assets?
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If I was unable to continue paying my home mortgage, besides foreclosure could the bank attempt to seize my other assets?
Asked on August 18, 2011 New York
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
The answer is no--and yes.
No in the sense that unless you somehow gave the bank a security interest in your other assets--e.g. used them as additional collateral--the bank does not directly have the right to repossess or seize them. Only assets which secure a loan--the way the home secures its mortgage--can be taken by lender.
However, any creditor who obtains a judgment against you--i.e. sues you and wins in court--and is then not paid on that judgment (i.e. you don't pay them the amount of the judgment) can look to several different court-ordered mechanisms to secure payment. One is garnishing income or a bank account; another is putting a lien on real property; a third is executing on personal property, or forcing its sale.
So IF after the home is foreclosed upon and sold, there is still a remaining balance on the loan (the proceeds of selling the home don't pay off all you owe) and the bank chooses to sue you for that balance, if they then get judgment against you, there are scenarios in which the bank could, at this juncture, proceed against you income.
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