Legal Question in Real Estate Law in New York

Hard to tell without seeing the language of the Mortgage and the Note. It depends upon whether there are personal guarantees, if the Mortgage is recourse or non-recourse, the language of the Note, etc. The consequence could be mearly loss of the property, to personal recourse. If you could get me the documents to review, a better response can be provided.

Typically, foreclosure of the mortgage will result. If the property is worth less than the mortgage balance, the mortgagor will have income from discharge of indebtedness unless the mortgagee enters a deficiency judgment. Most banks don't bother with that step so long as they get the property (unless they are also enforcing a personal guarantee, in which case you would not have income but you would have a personal obligation).

Beyond that, as Mr. LeVine said, one would need to review the documents and interview you to properly evaluate the situation.

This is not legal advice. If it were legal advice, it would come with an invoice.

Kevin J. Connolly

Attorney and Counsellor at Law

Anderson Kill & Olick, P.C.

1251 Avenue of the Americas

New York, NY 10020

212-278-1471

Fax 212-278-1733