No Anti-Deficiency Protection for Home Improvement Loans

Home Remodel

Question: Last March we bought a home in the “Arcadia Lite” area of Phoenix. We borrowed a high-interest $250,000 second mortgage (“Second Loan”) to “fix and flip” the home. We tore down two of the smaller bedrooms to make a large covered patio surrounding the swimming pool. We completed this construction six months ago and…

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Strategic Defaults Are Not “Illegal”

Hypothetical: Microsoft founder Bill Gates owns a rental home in Arizona which is “underwater” because the value of the home is less than the amount owed on the mortgage used to buy the home.  Bill Gates intentionally stops making the mortgage payments, and the mortgage lender forecloses. Issues: Does Bill Gates have any personal liability…

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