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  1. #1
    Join Date
    Dec 2010
    Posts
    2

    Default Being Sued by Second Mortgagor Before 6 Month Redemption Period is Up

    I got served about 13 days ago by a lawyer representing the holder of my 2nd morgage and am wondering where to go from here. I've got a lawyer but he will not talk to me before the 21 days I have to respond are up (I'm getting another lawyer). Can they sue me before my 6 month retention period is up? How should I respond to the court? I'm in Michigan and the details are listed below.

    House was foreclosed on in September by Home Equity line of credit ($10K). They were first in line over my primary mortgage from Citi because I refinanced after I took out the HELC. Unusual but true.

    The Home was sold at a sheriffs sale for the $10 K to a private individual. Citi then bought the house from the private individual and is going to foreclose on the property again in early January. They (Citi) files suit (Suing me) for the amount they paid the private individual for the house. They served the papers on 12/11/2010 and said I must respond in 21 days. I don't understand how they can do this because the 6 month retention period isn't up.

    I owe approximately $70K on the primary mortgage and the house is probably worth $20K and I'm assuming they will come after that deficiency later.

    My question involves a foreclosure in the State of: Michigan

  2. #2
    Join Date
    Sep 2005
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    Behind a Desk
    Posts
    98,846

    Default Re: Being Sued by Second Mortgagor Before 6 Month Redemption Period is Up

    If I understand what you're saying, the second mortgage lender foreclosed, that process was completed, and the property was sold. The proceeds of the sale, after expenses, then presumably went to your primary lender as the senior lienholder. Somebody bought the property at the foreclosure sale and the primary lender acquired it, presumably to protect their interest in the property above the sale value.

    Now you variably tell us that the HELOC lender is suing you for the unpaid balance of the HELOC and that Citi is suing you for the amount they paid for the house. Which is it? Both? Which suit are you asking about?

    Either way, no, a lender entitled to a deficiency judgment does not have to wait until the redemption period expires in order to pursue you for the money you owe. If you want to redeem the property, redeem the property.

  3. #3
    Join Date
    Dec 2010
    Posts
    2

    Default Re: Being Sued by Second Mortgagor Before 6 Month Redemption Period is Up

    The HELOC was considered the first; they got their money and are out of the picture with nothing left over for Citi. Citi (the 2nd) were not at the sale and didn't bid. They have bought the property from the private individual and are currently suing me for that amount ($13K). Once they sell the house there will be a deficiency, which they will also sue me for probably another $70K.

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