Shelby, AL asked in Bankruptcy and Foreclosure for Alabama

Q: My husband and I personal guaranteed (up to $25,000) on our daughters personal residence mortgage. The bank foreclosed

on it and sold it for less than was owed. Our daughter filed bankruptcy. My husband died. And the bank says that I must pay the $25000 plus interest. (Eventhough they had assured me after his death that I would not owe it). Do I have to pay it?

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1 Lawyer Answer
Mark A. Baker
Mark A. Baker
  • Tallahassee, FL
  • Licensed in Alabama

A: Assuming that you have signed a personally guaranty of your daughter's mortgage loan, then it is likely that you have potential legal liability for the remaining deficiency following the foreclosure sale. However, in order for the mortgage lender to have the legal right to pursue you for that deficiency, it will have to file a lawsuit in the county where the property sits, or where one of the guarantors lives, and get a judgment against you for the remaining sums owed. Unless and until the mortgage lender obtains a deficiency judgment against you, it is not legally entitled to collect the deficiency.

This advice is general and the particular facts of your situation may change the advice, so you should not rely solely on this advice. You should consult with an attorney of your choice to be sure that the facts of your situation meet the requirements of the law.

Best of luck,

Mark A. Baker

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