$800,000 Mansion - Will It Sell Or Will the Lender Foreclose on Kim Zolciak?

Renowned for her role in the "Real Housewives of Atlanta," Kim Zolciak-Biermann, alongside her husband, former football player Kroy Biermann, faces a significant housing crisis. Their sprawling Georgia mansion, nestled in the Manor Golf & Country Club in Alpharetta, Georgia, is on the brink of foreclosure. The opulence and grandeur of this 6,900 square foot mansion, with 5 bedrooms, 6.5 bathrooms, a spa, a waterfall, basketball court, and an elevator, reflected a lifestyle synonymous with the high-profile couple.

Kim Zolciak-BiermannPhoto byKim Zolciak-Biermann

However, even the rich and famous must pay their mortgage note! Their failure to do so was declared as grounds for the foreclosure action. If the estate is sold – whether through the traditional method of listing it with an agent or at a foreclosure auction – all proceeds will go towards settling their outstanding debt.

Strategic Measures: A Bid to Halt 🛑 Foreclosure

Although it was slated to be auctioned off in early 2023 at the Fulton County courthouse, they may have managed to put a pause on the action – for now. In a bid to halt the impending foreclosure auction of their Georgia mansion, it’s reported that a judge has granted them permission to list the property on the Multiple Listing Service (MLS) with the intention to sell it. This strategy aims to recover as much capital as possible from the sale.

If the property sells for less than the outstanding debt owed to the lender, it's highly probable that the couple will remain liable for the difference between the selling price and the remaining mortgage balance. This process of selling a property for less than the loan that’s on it is called a “short sale”.

Do Short Sales Work, though? 🤔

In very broad terms, short sales serve as a tactic to temporarily pause the foreclosure process. Typically, the lender's approval is necessary for this approach, given the potential loss of a full loan repayment. If they consent to a short sale, a defined timeframe for the selling process is usually established. If the sale doesn't materialize, the lender is likely to reinstate the foreclosure proceedings.

When short sales are completed, in some cases, lenders may agree to write off the amount they’re “shorted”. When this happens, the borrower is absolved of the responsibility of ever having to repay the discharged amount.

A foreclosure or short sale can hurt more than just your credit scorePhoto byPexels

But not all lenders forgive the outstanding debt and in these cases, a lien for the owed amount is attached to the borrower’s credit report. This can impact a borrower’s financial life for years and in more ways than just their credit score.

It’s crucial to understand that even if the outstanding debt is forgiven, a short sale on a borrower’s credit report can be just as detrimental to his or her financial stability as a foreclosure.

Kim’s Future 🔮 Still Undecided

Can a short sale resolve Zolciak-Biermann's foreclosure threat? At the moment, it’s too soon to tell. But hopefully, for her family's sake, the mansion will sell rapidly, for a decent price and they can all move on to the next chapter of their lives, in peace!

Sources:
https://www.usmagazine.com/celebrity-news/news/kim-zolciak-and-kroy-biermann-seek-to-avoid-devastating-foreclosure/
https://pagesix.com/2022/10/25/kim-zolciak-biermanns-house-in-georgia-once-faced-foreclosure/