Kevin Martin Defaults on Mortgage for California Home
Martin originally purchased the property for $1.9 million, including a $1.5 million mortgage. But home values have plummeted in his neighborhood over the last few years, and Martin's attorney Michael Hackard told the Sacramento Bee that his client is attempting to negotiate a short-sale with his bank for $1.1 million.
Even though Martin has been served with a notice of default, the first step toward a potential foreclosure, Hackard indicated that a foreclosure is not likely to happen.
"He always wants to do the right thing," Hackard told the Bee.
"He's a stand-up guy. There's a legal dispute that he is right in the process of solving. ... He's not walking away. We've got a certain dispute with the lender."
A short-sale entails selling a house for less than what is still owed on the mortgage, meaning the lender takes a loss but avoids having to take possession of the property through foreclosure. Banks usually approve a short-sale only when the home owner does not have the means to pay the difference between the sale price of the house and the balance of the mortgage.
Martin, entering the third season of a five-year, $55 million contract signed in 2007, could pay the balance of his mortgage with roughly two months' salary, which may be why the bank is so far balking at taking a loss.
The Bee reports that about one-fifth of the 100 homes on Martin's street have been served a notice of default in the last four years, and that Los Angeles Lakers forward Ron Artest finalized a short-sale a few months ago on a home he owned in Loomis, Calif., several miles away.
-- Information from the Associated Press was used in this report.