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baker1510 · Joined: 14 Jan 2010 Posts: 20 -0.91 Dollars($)

What if you owe 550k on your house split between a first 440k and a second 110k, but due to home pricing dropping, my house is now worth 400k. What can I do?

jameshogg · Posted: Wed Jan 27, 2010 12:15 am Post subject:

Hi baker,

You can apply for a loan modification with both the lenders if you wish to save the property. The lender would reduce your interest rates so that it becomes affordable for you to pay off the monthly payments. However, getting a modification would depend upon your financial situation.

If you don't intend to save the property, you should apply for a deed in lieu of foreclosure. This will help you get rid of the property. The lender would sell off the home to recover his dues. Though you won't be responsible for the deficient amount resulting from the first mortgage, the second lender may sue you for his debts.

Thanks

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