[sibling]

My friend & I are behind pymts & soon it's about to go into foreclosure. She has another house where she resides in another state w/little equity. I have a house (my family & I have equal shares on this house) with equity & no mtg. If the house we're both on mtg goes into foreclosure, would I be forced to repay it from the equity of my house? If so, will this affect my family's shares? Also, will my retirement plan be affected?

[George_1950]

Your retirement plan may be 'exempt' under state of federal law, but your equity in the family property is subject to your debts, and your equity is subject to any family member's debts.

[Fr_Chuck]

They may come after their money in many ways, they really want cash, garnishments, attachments of bank accounts and more. Putting a lien on your other property is most likely the last thing they want to do

[ScottGem]

Laws on this are changing. The current mortgage crisis has forced local, state and even the federal govt to enact laws protecting people caught in the credit crunch. So its hard to state for sure what the prevailing laws are for your area.

If the law allows the lender to obtain a definciency judgement if there is a balance left after auction, then yes, they can go after most assets you have. However, if they don't, then your other assets are protected. You could, however, find yourself with a larger tax bill, if the deficiency is allowed to be forgiven as a gift. You would then get a 1099 representing the deficiency.