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Debt Relief – Insolvency – Bankruptcy Information » Foreclosure Help » Losing condo to foreclosure, it got vandalized and flooded, do I have to mitigate the amount of damages or?

Losing condo to foreclosure, it got vandalized and flooded, do I have to mitigate the amount of damages or?

I just tried to do a short sale but my 2nd mortgage lender wouldn’t accept the offer. It is going to foreclose. It is vacant and was vandalized with flooding some time in the past few days and is terribly damaged.

If the bank is taking it away, could I be held negligent for not mitigating the damages from the obvious water damage caused by the vandalism?

Could I be liable for damage to the neighbors property from the water seaping into their walls?

Do you know the foreclosure process? What might expect after the foreclosure if the second lender has to take a huge loss?
No insurance, not investment property, the property has been secured. The flooding was due to the vandalism, someone went into the property, plugged up all sinks and turned on the water. It was apparently on for days. I just found out since I live somewhere else now. A police report was filed but it was by the HOA, I have to order a copy in the mail. I know the water has been turned off but the place has been soaked for days. The upstairs soaked the floors so much that caused damage to the downstairs ceiling. It is just awful, so I hear.

I think finding a real estate attorney is a good idea, I will likely oblige. I have a bankruptcy attorney in the family that has been trying to help me (a little) but I should probably find someone that specializes in real estate.
The 2nd mortgage is for $85k, and I have $0. No choice but to foreclose if they refused to take the short sale offer.

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4 Responses to "Losing condo to foreclosure, it got vandalized and flooded, do I have to mitigate the amount of damages or?"

  1. valstpatrick says:
    What a tough situation – all around.

    First, can you resecure the property quickly?
    Is your home owner’s policy still current and in force?
    Did you file a police report on the vandalism?
    Have you controlled the water problem or is it still ongoing?
    Do you know a real estate attorney?

    The foreclosure process can be quick, but more than likely it will be 3-9 months; depending on your lender and area. Certain parts of the country are having HUGE increases in foreclosure filings and the ‘system’ just can not keep up. If your property is sold at auction, taken back by the bank and resold and the second lien holder is NOT satisfied (meaning paid in full) then YES, THAT lender has a right to file a judgment against you for the difference in payoff vs. loan balance. Keep in mind your lender will add attorney fees, penalties etc to the loan balance.

    A real estate attorney should advise you on your liability portion as to the water damage and vandalism losses. If you have home owner’s you can file a claim for your unit damages and maybe even the connecting unit’s that were affected. Additionally, the condo has what is called a ‘blanket’ policy that insures the ‘outside’ portion of your unit, like roof, common areas and the like. Depending on ‘what’ caused the loss (water damage) the condo’s main policy may also file a claim and share the damages. Not to mention if access controlled systems were nonfunctional and resulted in your loss; you could have other filing rights – so speak with a real estate attorney to advise you.

    You should also speak to a bankruptcy attorney to discuss options IF this condo was an investment home. The lender may try to attach a judgment against your current primary residence. Seek advice now so you will know your options.

    Good Luck

  2. liveinaustin says:
    If it was a criminal act, you should not be held liable, although I would also file a police report as you too suffered a financial loss due to the damages to the part of the structure you’re responsible for. If you didn’t have any insurance, the neighbors and the HOA could both go after you, but only an attorney could tell you what their chances would be based on the law and precedents. If you don’t have anything (money, assets), I doubt that anyone will see the benefit of litigating. The neighbors insurance company (assuming they have insurance) will take care of their portion of the damages and the HOA will take care of their portion…..at least theoretically.
  3. John Rosa says:
    This is harsh because there’s no insurance.

    If this is your primary residence, you could declare bankruptcy if you want to save the condo. If not, and there are no buyers or the lenders don’t approve the short sale, you really have no choice.

    As for the foreclosure process, I suggest you get familiarized with it as soon as possible. Please look up this book on amazon or other bookstores for more information on how foreclosures work: Complete Guide to Real Estate Tax Liens and Foreclosure Deeds: Learn in 7 Days [ISBN 0978834682] by Don Sausa. You’ll find how the process generally works and you might learn a thing or two about your credit report.

  4. ramesh says:
    If the short sale is not too much of a difference you can talk to your 2nd lender and tell him that you will get the funds to close that loan.

    do not go for foreclosure because it will affect your credit. i think you can find some 0% APR credit cards for balance trasnfer and transfer the moeny from credit card to close the 2nd mortgage loan.

    after that try to save some money on a regular basis and pay off the 0% apr loan.

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