Do judgments attach to a foreclosed home?

[Andrew Stoll]

In researching titles, I have found many owners to have judgments against them. Being new to the game, I try not to risk acquiring a home that is owned by someone with a judgment against them, especially if I'm not sure if it carries with the home. Does it?

As an example: the owner of a foreclosed home has an $8,000 credit card judgment against them. If I buy the house at the foreclosure auction (Illinois), will that judgment carry with the property? Or does the judgment stay with the person, and not the prop?

Thanks for the help!

-a

[Joel Owens]

I can't give legal advice but generally speaking a judgment may or may not be attached to the property.

It depends on the owner and if they did any legal maneuvering with title taking name off and putting back on etc. The judgment if attached to the property is nothing more than a lien interest.

If that seller gets foreclosed on the judgment from an individual or typical creditor would be wiped out. The debt would still follow the foreclosed owner until they settled or completed a chapter 7 BK or crammed down in a Chapter 13.

If the proceeds from the foreclosure sale pay off the first in full and the only other lien is the judgment then the extra proceeds would go to pay that down.

If you are buying a short sale then you would negotiate with that creditor and they might release for a 1,000 to 2,000 payoff on the 8,000 but still reserve the right to pursue the former owner at a later date for the balance.