Just that. Can someone with a first mortgage in a “no recourse” state just up and split without the mortgage company being able to come after that person monetarily?
I know they’d take a hit on their credit score, but that’s beside the point.
I’m not interested in short-sales, 2nd mortgages, or home equity loan info–just first mortgages.
What say you?
Yes. That’s the whole point of “no recourse” laws. The mortgage holder can foreclose on the property and, monetarily, they will receive only the high bid when the property is sold at auction. If that does not cover the full debt owed, they are out of luck on the rest.
This assumes there was no fraud involved in the loan…if that happens, all bets may be off.
(Side note: In my state (Illinois), the mortgage holder is usually the high bidder at auction and they typically bid the full amount owed. They then go ahead and sell the property through a real estate agent. This is due to a quirk in redemption rights here).