Can I buy a home for cash before my current condo is foreclosed on?
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Can I buy a home for cash before my current condo is foreclosed on?
My foreclosure is imminent. I want to buy a low price home in a 55 and over adult community. I have been putting money into an escrow account since I have been unable to meet my mortgage.
Are there any legal ramifications in doing this?
Asked on June 21, 2016 under Real Estate Law, New Jersey
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
Yes, you allowed to buy a home (or anything else) for cash while you are being foreclosed upon. The legal ramification (for any tax consequences, speak to an accountant or tax preparer) is that if the foreclosed condo brings in less than the outstanding balance on the loan/mortgage (after costs of the foreclosure and sheriff's sale are factored in), the lender can come after you for the "deficiency" or shortfall and, if you do not pay it, could potentially put a lien on the new property.
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