ANSWERS: 2
  • They can try to go after what is needed to get money, but it is really tough to get someone's home.
  • Yes, but with one limitation. Most states have a homestead exemption that protects a certain amount of equity in your property against a judgment. Moreover, in order to foreclose on the property, the foreclosure must cover a significant portion of the judgment. Thus, unless you own your home, there will often be too little equity ton allow foreclosure. For example, suppose you have a home valued at $500,000, with $160,000 of equity in the home. Suppose I have a judgment of $10,000 against you. Now suppose that the homestead exemption in your state is $150,000. In this case I can foreclose on your house because after deducting the homestead exemption, the equity would completely pay off my judgment. Of course, if you were smart, you would simply pull a loan against your equity and pay off my judgment. No suppose that my judgment is for $100,000. In this case I could not foreclose. Even though you have enough equity to cover the judgment, $150,000 is protected. However, I could file a lien against your property, and collect once you sell the property.

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