How do you pay deficiencies after foreclosure

[Radiance]

If I go foreclosure I will most likely be sued for deficiencies, I am 70k under water and the mortgage was not used to buy/improve the house. I cashed out so I am not protected against deficiencies

Also, I understand I will be responsible for taxes over that 70k deficiency

How is that paid? If I can not pay my mortgage I won't be able to come up with 70k plus taxes.

People do payment agreements for that?
How is that done?

I checked, I am not elegible for bankrupcy because of my income bracket and my mortgage being less than 31% of income.

[swanson719]

If your mortgage is only 31% of your income you shouldn't be foreclosed on. Which means that you have some budget problems in there someplace, or other outstanding debt. I would let other things slide to bring the mortgage up to date and see if you can get a personal loan to cover the difference for now.

If you do lose the house, you have three options really. First, you can contact the bank you hold the deficiency with and work out a payment plan if they are willing, which is a toss up. Second, you can try to take out a loan with a different bank and transfer the deficiency to someone who is willing to let you do a payment plan. Or third, if you can't find a bank who will do a payment plan, the bank who filed the foreclosure will come after you in court and the judge will arbitrate a payment plan. Either way, you'll pay the taxes on anything that's given as a loss, and you'll end up with a payment plan and not a lump sum.