NLIC.org

Neil Said:

Does mortgage insurance kick in when a mortgage goes into foreclosure?

We Answered:

Nope, your screwed

Jesus Said:

Why are banks in so much trouble (due to foreclosures) when mortgage insurance should have covered the losses?

We Answered:

lets say you live in one of those areas where the housing prices were so far artificially inflated by too much government involvement in home buying that you bought a 3 bedroom home near LA for 500000. As the bubble popped your house is now worth what it should have been worth around 200000 - 250000. having some insurance for 20% of the bill (100000) will not cover the rest.

Multiply that time 100 million and banks are done.

In many cases my example numbers are probably low.

Freddie Said:

Will the garnish my paycheck or take my tax returns in Oklahoma for an FHA mortgage foreclosure debt?

We Answered:

did you look up your states laws on recourse? If they have it yes they can not only send you a 1099 on any shorts after it is sold but the lender can sue and get a judgment and then attach a garnishment to wages

Gwendolyn Said:

mortgage foreclosure with Private mortgage insurance?

We Answered:

All the mortgage insurance does is pay the lender if the house does not bring enough at auction to cover the entire loan balance. It doesnt benefit the ex-homeowner in any way at all.