Legal Question in Real Estate Law in Indiana
I own a property that is joint tenants. The other owner has a mortgage against the property only in his name - I am not a part of or on the mortgage instrument. If he chooses to default on the mortgage, I realize the bank will foreclose on the mortgage and force a sale to recover on the note. However, even though I realize they have a first position lien, there is significant equity above the due amount on the note. This, I believe, I am entitled to once his mortgage note is satisfied through the forced sale. When there is another real property owner such as myself, how does the sale get settled where the bank recovers what they are only owed and I receive the remaining balance less all closing/transfer costs shared equally since the bank forced the sale to begin with? Again, I am not included or a co-borrower or anywhere on the mortgage note (that is entirely his debt) but have equal rights per the warranty deed to the property.
1 Answer from Attorneys
Practically speaking, you will not see a dime. At the foreclosure sale, a bid will likely be made for the amount of the mortgage and no more, especially in this economy. You may be better off by trying to sell the property in a non distressed manner. You should contact a local attorney for an in person consultation. It sounds like there is a good amount of equity here, and it would probably be worth your while to hire counsel.
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