What happens when both the bank and borrower walk away from a foreclosure?

What happens when both the bank and borrower walk away from a foreclosure?

What happens when both the bank and borrower walk away from a foreclosure?

What happens when both the bank and borrower walk away from a foreclosure?

This is a new concept I was not aware of.  I know borrowers default on loans by simply walking away from the property.  After that the bank usually forecloses.  I guess banks are being creative and want to avoid further costs on underwater properties so they also walk away and don’t complete the foreclosure process.

I am not sure who owns the property at that point.  I would think the lien still exists so the bank would still be held liable until it is re-sold but I am not sure.  This is happening and we can only see how it plays out.

Chicago Tribune:

A new type of property is adding to neighborhood blight: the bank walkaway.

Research to be released Thursday, the first of its kind locally, identifies 1,896 “red flag” homes inChicago — most of them are in distressed African-American neighborhoods âÂ...


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