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CGaskill
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evolovik26
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colin
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larry

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Dee
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Posted: Wed Sep 30, 2009 12:37 pm Post subject: Incorrect information
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In regards to the information given about the charge off, you DO still have to pay for your outstanding debt. A charge off is an accounting function that affects the company internally. The mortgage company is basically taking a loss on your bad debt, since you are not paying. You receive a 1099-C at the end of the year, and have to claim the entire amount as income.
You still owe the debt, they will still come after you, and they can still refer you to outside collection agencies who will pursue payment.
Also, the second lien holder can and will foreclose on you for non-payment if foreclosure is warranted. The second lien holder will complete a financial analysis and review the expected return due to them. If the return qualifies under their guidelines, they will commence foreclosure, pay off your senior lien, and take title to your property.
In this case, since they charged off your second lien, they have already made the determination that foreclosure is not warranted.
When you choose to sell your home, the second lien holder still has a lien on your property, and you will need to satisfy both the first and second lien in order to sell.
If your first lien goes into foreclosure, and the bid amount at the sale is not enough to satisfy your total debt, it will create a deficiency balance which you may be liable to pay, depending on your state law.
You would still be responsible for the 2nd lien, regardless of the foreclosure as you signed under the terms of the note.
Hope the info helps! |
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L
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gmakerley
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jameshogg

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