Posted by Rich-CA on September 05, 2007 at 20:17:40:
Depends on the state and county. If the mortgage is a recorded document, like TX or AZ, you can pull up the recorded documents on the web. if its like CA or CO and you don’t have a subscription to an online records service, you will have to go to (or write to, but I’d go) the County Recorder’s office to look at the document (and get a certified copy).
Forclosure on an assumed FHA Loan - Posted by Jill Gleghorn
Posted by Jill Gleghorn on September 05, 2007 at 06:40:12:
We sold our house over 10 years ago on an assumable Non Qualifying FHA loan. The house is now being foreclosed on. We were notified by a collection agency regarding this. Are we responsible for the note, and if so, what are our rights?
Re: Forclosure on an assumed FHA Loan - Posted by Rich-CA
Posted by Rich-CA on September 05, 2007 at 17:04:01:
Is your name still on the mortgage or did they complete the assumption of the loan before closing the sale?
If the loan was assumed successfully by the buyer, you have no responsibility. Write the collection agency a letter to this effect (do not provide them copies of the documents, you are under no obligation to do this) and tell them to go away. The one who set the collection agency into motion will have to prove you are the one who owes money and if you have the proof the loan was assumed, they have no business contacting you.
Re: Forclosure on an assumed FHA Loan - Posted by River City
Posted by River City on September 05, 2007 at 07:12:03:
I had no idea there were any of these loans left in existence. FHA had assumable loans, however, the person assuming the loan had to qualify with a lender for the original mortgagors to be released from the loan. I believe one reason FHA discontinued these types of loans was because people did not understand exactly how they worked until it was too late. There were a lot of unqualified people assuming the loans and they did not go through lenders to do the assumptions, leaving the original mortgagors in trouble.
Re: Forclosure on an assumed FHA Loan - Posted by River City
Posted by River City on September 06, 2007 at 10:29:46:
FHA’s assumable loans were NOT non-qualifying assumable loans. I processed MANY of these transactions for U.S. Mortgage in Tampa, Florida back in the 1980’s. To be released of liability on the loan, the purchaser had to be qualified by the lender and then the seller was released of their obligation. If the purchaser was NOT qualified by a lender, the loan could still be assumed at the original rate, however, the seller was not released of their obligation. These loans worked the same way FNMA’s and FHLMC’s assumable ARMs do now.
You need the documents sent to you from FHA indicating that you were no longer responsible for this loan. The collection company that purchased the loan should be able to give you any documents that prove you are still obligated on the Note. Do NOT ignore the request from the collection company. If you ignore it, they can still file proceedings against you and it WILL go against your credit as a foreclosure. Do NOT let this happen to you.
As a last resort, you might be able to get your information directly from FHA using your FHA case number. It will take them time to research it because they were not totally automated at that time and someone will have to go back into the records to research it. This will cost money, probably an hourly rate. At the very least, they can explain how their assumable loans worked at the time you closed on the original loan.
Good luck.
Re: Forclosure on an assumed FHA Loan - Posted by Jill Gleghorn
Posted by Jill Gleghorn on September 05, 2007 at 19:17:35:
How do you find out if your name is still on the mortgage? Do we contact the county? Instead of contacting the Collection agency, we contacted the mortgage company and they do not have us listed, but it is not the original mortgage company, and this mortgage company will not send us a release of liability. But we have sent them copies of the transactions and we still don’t have a straight answer.
Re: Forclosure on an assumed FHA Loan - Posted by Rich-CA
Posted by Rich-CA on September 05, 2007 at 20:19:11:
Another possibility. Get a Title company to do a full search on the property address (you have to pay for it). They do this all the time and even though they sometimes miss things, they usually don’t.