Can a bank take all your personal saving/checking accounts to satisfy a second mortgage?
Ok, so my friend had a house that had a first and second mortgage. He sold this house in short sale on just the second mortgage as the short sale. The second mortgage became a personal unsecured loan for the remaining amount. A month later the bank sent him a letter saying they will come down on what he owes on the remaining unsecured second if he pays “X” amount by a certain date. So, my friend got an attorney to negotiate a little more and make sure this was handled properly. In the mean time the expiration date passed and the bank took everything my friend had in his checking account and mutual fund account. Yes, it just happens that the unsecured second was in the same bank that he had his checking and mutual fund account. They took everything…even more then what they said they would take as a payoff….way more. Can they do this? Can he get his money back? No where in any letters or paperwork that he signed did he put his personal accounts as collateral or they say his personal accounts are collateral. Is this legal what they did???