Posted: Mon Jan 29, 2007 8:47 pm Post subject: Are there any other options besides foreclosure?
My boyfriend and I signed a quit claim over to four investors on our property over 2 yrs ago. However, the loan is still under our names but the investors have the deed. We made the stupid mistake of going by pure trust that they will make the payments. Now one of the investors has dumped her 25% share back over to us because the market is bad and she can't handle the negative anymore, but neither can we. Is there any other way out besides foreclosure? And can the 3 remaining investors take any legal action against my boyfriend and I if we let the loan go into default?
Posted: Mon Jan 29, 2007 10:25 pm Post subject: RE: legal action for not paying
Hi Sharen,
Welcome to forums.
The investors may not take legal action but the lender may surely like to foreclose. The only way out I feel is to sell the property and pay off the loan. Or else, you can go for a deed in lieu and give away the property to the lender. The lender will sell it off at a suitable price and retrieve what he has already invested.
Have you discussed the situation with your lender? What does he has to say? If he hasn't, then you can opt for a number of ways to avoid foreclosure.
First of all, there is the forbearance by which you can go for a different payment plan that the one provided to you earlier. Also, you can request the lender to modify the terms and conditions of the loan.
However, if you are unable to pay anything, then you may request the lender to suspend the payments for a certain time period. Within this period, if you can accumulate sufficient funds, then probably you will be able to make your loan current.
Yes it is always advisable to take the lender into confidence. Don't hide any of the facts from him; if you explain the problem you are facing, he will be able to provide you with a solution.
Wait a second here. Did I miss something? Sharen75 and her boyfriend signed their ownership rights to their property to 4 investors 2 years ago. The did not tell their lender about this at the time, otherwise the lender probably would have pointed out that by transferring ownership of the collateral to people not on the note, puts the note in a technical default and "calls the note".
For the past 2 years Sharen75 and her boyfriend have paid "rent" to the investors who then paid the mortgage company. I may have that wrong so please correct me if I do.
So now 2 years later, one investor has given their 25% interest back to Sharen75. Am I correct in understanding that you were paying an amount LESS than the mortgage payment to these 4 investors over the past 2 years with the trade-off being they keep your equity? I'm not following 100% here so please help.
either way, the suggestions above make very little sense.
1) don't call the lender now. Once they find out you don't actually own the property you are going to have them tell you that the note is now due. You "sold" the house...they want their loan repaid.
2) Jameshogg suggests you sell the home or give the deed to the lender. Only problem with this is that you no longer legally own the home to sell it nor can you give the deed to the lender.
If you want to keep your credit preserved without a foreclosure then you are really in a pickle. In 10 years of mortgage lending there is no experience I can draw from. I can't think of a non-foreclosure way out of your situation. I wish you luck but I think if you can't keep the mortgage on-time this one is going to foreclosure. Obviously you need to talk to the other 3 investors and see what they want to do as they have something at stake in this as well.
good luck. _________________ Ken Stampe is a Mortgage Loan Originator, Mortgage Author and Mortgage Loan Officer Instructor living in Dallas, TX. Contact by email at
Pre-foreclosure sale. This will allow you to avoid foreclosure by selling your property for an amount less than the amount necessary to pay off your mortgage loan.
You may qualify if:
1. the loan is at least 2 months delinquent;
2. you are able to sell your house within 3 to 5 months; and
3. a new appraisal (that your lender will obtain) shows that the value of your home _________________ Mortgage Refinancing | Refinance | Refinance Second Mortgage
Pre-foreclosure sale is no doubt a good way to avoid foreclosure. But then Sharen says that she has already quitclaimed the property, so how can she sell the property? _________________ Procrastination is the enemy of your financial sucess
sharen75
