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Stop paying second mortgage - What happens next?

I have a 1st & 2nd mtg and I have requested a short sale. I am able to make my 1st mtg payment but I do not have the funds to make my 2nd mtg pymt. If I stop paying [url=http://www.mortgagefit.com/second-mortgage.html]second mortgage[/url] what happens? Can the 2nd lender foreclose on my house? And if not, what happens to the 2nd loan? If they charge off & put a lien on my house, then I will never be able to sale it because I owe more than the house it worth? Any advice? Also, if they charge off & put a lien on my house, can I then BK it?

adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Welcome Guest,

The second lender can foreclose on your property. But it will have to pay off the balance on the first loan and then any remaining amount can go towards the second.

If you are not able to pay off the second loan, the lender may either issue a charge off which implies that he has decided not to collect on your loan.

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smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Guest,

Welcome to Forums!

By charging off your loan, the lender decides the he will not collect your loan. Rather he has sold of your loans to a collection agency who will inturn collect the loan from you.

Feel free to ask if you have further queries.

Sussane

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I'm not paying second mortgage since a year and as smithsussane said: the lender decided not to collect my loan and referred my loan to a collection agency. Recently they started calling me, yet the only offer they got for me was to set my checking account so they can take "a minimum payment" from there so, the lien won't keep reflecting on my credit. I told them "no." I said that I wanted something more concrete like a modification loan that can actually guaranteed something on their behalf.

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jerry's picture
jerry | Joined: October 17, 2005 03:24 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Virgilio!

As far as I know, the collection agency will not be able to give you a loan modification. They can only collect the dues from the debtors. Its better you pay off the dues because there have been several instances where people have been harassed by the collection agency. They may even double the charges if you do not pay the dues.

Thanks,

Jerry

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gmakerley's picture
gmakerley | Joined: November 9, 2007 07:36 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

wow, as usual.

a second loan is already a lien on the property. the collection agency need not place a lien, as one already exists for the debt being discussed.

that lien will need to be paid in full upon sale of the home, unless you make some sort of arrangement to pay less than the total due.

jerry..."they may even double the charges if you do not pay the dues"???????? what are you referring to? there is legality involved here. no collection agent can "double" charges without a legal basis to do so; and "if you do not pay" is not a legal basis for such doubling.

i find it quite unusual that a second lender would engage a collection agency in order to collect its balance. they have every right to bring a foreclosure action to recoup their funds.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If you owe more than your home is worth. Lets use this as an example: You have 460,000 on your 1st and 90,000 on a second. Your home is approximately worth in todays market...250,000 but you owe 550,000. The 2nd can't foreclose on your home because they would have to pay off the 1st to recoup any money. Thats not possible, they wouldn't pay 200,000 to your 1st and collect nothing for themselves. That is why perhaps it was sent to a collection agency. I think it would be stupid to keep paying on a 2nd if you are so upside down. Also keep in mind the 2nd was based on the appraisal that you had when you took your 2nd out. If that money isn't there anymore then they have nothing for collateral (meaning home is not worth as much). They can scare you all they want, waste phone calls whatever, but they WON'T foreclose on your home in todays market. No way No How. If they do, they are retarded.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Interestin because I am in a similar situation where my house is worth about the same as my first home loan(250,000). I have a 2nd for 125,000. I've heard of people filing bk on the second and staying in the house. I really don't have any other debt other than small car payment and small balance on cc. Rather than pay lawyer for BK work, should i stop paying my second mortgage? They would lose money if they foreclosed right now. By the way the 2nd was a refi of the original heloc and i took it out for more $. Both 1st and second are interest only. I went from making 80,000 to 45,000 a year recently and something's got to give.
Any advice?
thanks

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jerry's picture
jerry | Joined: October 17, 2005 03:24 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Pacifico,

If you are facing problems in paying off the home loan, you should immediately contact the lender. If you inform the lender about your hardship, the lender may give you options so that it will be easier for you to repay the loan.

Speak to the lender about a loan modification, short sale or a deed in lieu. These will have a less negative effect on your credit as compared to a bankruptcy or a foreclosure. To know more about various ways to [url=http://www.mortgagefit.com/foreclosure/17ways-avoid.html]avoid foreclosure[/url], check out the following link:
http://www.mortgagefit.com/foreclosure/17ways-avoid.html

Thanks,

Jerry

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hello all

Our situation is just like "Pacifico"

We have a 1st & 2nd

1st is interest only, 2nd is normal but higher % rate

First off, this is our first home

they added an addendum to our home loan papers at the last second totally messing up our written GOOD FAITH ESTIMATE.

We have made our payments on time for the past 3 yrs-PLUS PAID EXTRA whenever we could!!!

My husband just had his wages cut

WE CAN NO LONGER make our 2nd loan payment - funny how the lender calls IMMEDIATELY when they want their money but haven't listened to us for the PAST 2 YRS when we've tried to get them to [url=http://www.mortgagefit.com/refinance.html]refinance[/url] us and get rid of our ARM before husbands wages were cut!

These companies DO NOT EVEN get a REAL PERSON TO CALL US!
It says PRESS 1 IF YOU ARE SO AND SO, PRESS 2 if you are NOT
NOT EVEN identifying themselves

For 3 years we have given them our money, we DESERVE better than this!
This is AMERICAN HOME MTG SERVICING and HOMEQ

Stay FAR FAR FAR AWAY FROM THEM!

They are IN INDIA!!!

PO Box address and toll free number - HORRIBLE, NASTY, PATHETIC and NO CUSTOMER SERVICE!

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jerry's picture
jerry | Joined: October 17, 2005 03:24 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi alliblake,

I can understand how frustrated you must be feeling. Check out with your lender the options of loan modification or forbearance. In loan modifications, the lender will give you an alternative repayment plan to pay off the debts. In case of forbearance, the lender will either suspend or reduced your payments depending on your situation. You can also refer to link given by me in the earlier post where you can find various options to avoid foreclosure.

Thanks,

Jerry

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Thank you for your response Jerry, it is truly appreciated However, in our case this won''t help Realizing after, I did not mention that we also had a 5 yr arm, presently up in April/May 2010.

Therefore, this house would not even come close to what we paid (still upside down) when its time to refinance Therefore, we would be really stupid we feel not to just let ourselves go bankrupt doing a 13 in order to get rid of the 2nd loan. We do not quality for a 7

This is truly a very sad situation. These companies would rather us do this than work with us after we have proven ourselves for 3 solid years without missing a payment plus making extra payments This will lead our house to be empty, uncared for, and them getting next to nothing for it in the long run

We tried asking them to sell it back to us at the actual appraisal value now so that we would not lose our house. They would not do it They have left us no choice.

We are not willing to throw away our money over another year and a half for a house that will still not be worth the value paid by the time the arm is up and refinancing will be impossible. At what time do we cut our losses? Especially when we do not know if my husbands wages will be reinstated We have seen houses around us going to less than half of ours now... the same size, rooms, baths, lot size etc

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chad86tsi's picture
chad86tsi | Joined: December 20, 2008 10:28 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

You don't have to refincance after the ARm resets, what are the reset terms (how is it calculated)? It may reset lower than it is now given the current rates. If my ARM reset now, it would go more than 2% >down<.

The 5 year terms is just the amount of time that it won't reset, it's still a 30 year loan.

In my case, the ARM reset rate is the current (on the rest date) 1 week average of the 1year tbill, plus a 2.75% margin (the banks profit). Since the 1 year tbill is under 1%, I'd reset at >1% + 2.75% = >3.75% if it reset today. I would go from my current 5.75% down to 3.75%.

Mine is also due to reset in May 2010, but I'm not holding my breath that the rates will be so low then. You should find out what your terms are, you may be able to ride it out that reset if rates remian low, long enough to get back on your feet.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hello Chad

Thank you for your replied post

Even if we stayed on the present terms, this house is still upside down, we still have our wages cut

It would be inevitable that the 2nd mtg company will come after us?

They have been calling everyday yet do not identify themselves!
We know its them-its says press 1 if you are so and so, press 2 if you are not. We refuse to talk to a machine. Its rediculous

Irregardless, we cannot make the 2nd loan payment right now.

We saw a bankruptcy attorney to see where we stood.

He said if we claimed the 13 the 2nd lender cannot collect as there is no equity to collect on-it would be written off essentially. However, you cannot pay off the repayment plan on the 13 prior to 5 yrs or the 2nd lender can come back to try to recollect if you are making more money at that time

We do not wish to claim bankruptcy, so are hoping we can do a loan modification - however, our mtg company (1st) has been impossible to talk to. They outright said they do NOT do that. They said they could possibly lower the interest rate. I started laughing. That will be good for NOT much! It wouldnt help us

The 2nd lender when contacted a year ago said they cannot do anything without the 1st company doing something.

Therefore, we sit back right now and wait

Until they give us a real person to talk to...

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Niicss's picture
Niicss | Joined: October 3, 2005 11:54 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi alliblake

As far as I can understand your situation, you will have to speak to the lender. You have mentioned that you do not want to go for the option of bankruptcy. So you can check out the options of either a short sale or a deed in lieu foreclosure. However, the lender will be ready to accept any of these two options only if you are past due on your home loan payments. Moreover, you should also remember that you should opt for any of these options if you can afford to lose the property.

However, you should note that it will totally be the lender's discretion whether he will accept a deed in lieu or a short sale.

Thanks.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hello Niicss

Thank you for the great information!

We have a second mortgage, if we are understanding correctly after reading SHORT SALE, if you have a SECOND MORTGAGE we do not qualify?

Its beginning to sound like we can only try the DEED IN LIEU or the BANKRUPTCY?

We have a first and second

Our house is probably only worth the FIRST (254,000.00) according to online resource-our first is at approx. 267,000.00. The second is over 80,000.00

) ;

This was our first ever home purchase, and at this point, probably our last.

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adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Welcome alliblake,

There is nothing like you will not be qualifying for a short sale if you have two mortgages. You will have to start talking to a first lender for a short sale. If the first lender agrees, then you can start negotiating with the second lender. There are chances that the second lender will charge off your second loan to a collection agency.

To know more about [url=http://www.mortgagefit.com/second-mortgage.html]second mortgage[/url] charge off, check out the following link:
http://www.mortgagefit.com/know-how/secondloanchargeoff.html

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Great Forum,
I have a first with Wells Fargo for 210,000 and a second with National City for 270,000. My home is worth maybe 400,000 but nothing is selling here in Oregon. We missed our first payment with Wells and they sent me an acceleration letter in the middle of December, only 45 days down. Our second is also 2 months down. We have had to rob our 401 for the past year and draw on the second to live until they froze it in April. Now I am out of money. I have seen two conflicting reports when it comes to seconds, one that they can foreclose, the other says they won,t. Based on my value what is your opinion? Will the 2nd foreclose to pay off 210,000? What is the possibility of getting a payoff /negotiation of 10-15% of balance based on the value of the home? My spouse is not on the note and we relied on this income to make payments for the past year, got laid off over 8 months ago and thats where we ran into trouble. My spouse is now employed again and I am working odd jobs. My spouse has some funds left in a 401k so if we worked a deal with National City, we should be able to keep making payments on the first. Our total payments are nearly 3k a month, the first is half that.... fun situation. Thanks for any feedback.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hello Adonis

Many thanks for your great response

We did speak to the FIRST MORTGAGE company "AMERICAN HOME MORTGAGE" they are horrible!
We found out they are based in India
We did ask RE: SHORT SALE, they said "No, we do not do that"

Our first mortgage of course as you said, will not budge without the first, so we are 'stuck'

We have made out FIRST MORTGAGE payment, but didn't make the second

They call daily, but we keep missing the calls.

We will call them back and let them know we cannot make the second payment. My husbands wages were cut 45%!!!

Nasty mess this economy

For 3 solid years we have made out payments - EVEN PAID EXTRA most months thinking we were doing a 'GOOD THING'

) ;

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I have likely situation. I have first 250K in Countrywide initialy above 3 years ago. Second 50K was also in Countrywide, but after a few payments they move second to another company. Now I paid all on time. But my home now worth about 200K. What I can do? I have still good job and can pay 1st an 2nd. six month ago first mortgage rised my % to 9.5 the seconfd I have still for 12.65% For 200K I can purchase much better house than present. Please help? What can I do without destroy my good credit history. They don't won't [url=http://www.mortgagefit.com/refinance.html]refinance[/url] case va;ue my 2002 house?
Thanks ryszard

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Niicss's picture
Niicss | Joined: October 3, 2005 11:54 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi

To marim,

If the second mortgage lender forecloses the property, then the second lender will have to pay the dues of the first mortgage lender. I think the first mortgage lender can foreclose the property. But in that case, you will still be liable to pay off the second mortgage.

If you can afford losing the house, you can speak to the lender about a short sale or a deed in lieu foreclosure. In these two cases, you will have to pay off the second mortgage but the affect on your credit will be lesser.

To alliblake

As your lender has said that they do not do a short sale, check out if they can go for a deed in lieu. Though the credit will badly affected in a deed in lieu, it is better than a foreclosure or bankruptcy. As you are unable to make the payments, there are chances that if the first lender goes for a deed in lieu, the second lender will charge off the mortgage to a collection agency who will in turn collect the dues from you.

Thanks.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

ryszard, its true that as the value of your property has fallen, the lender will not refinance the property. You can try selling off the property. Once the property is sold, you can pay off the mortgage in full. Then you can buy a new house. Or else, you may rent this house and buy a new house. But before doing so, check out the mortgage docs to see if the lender may call the mortgage due if you rent the property. If such a clause is mentioned, then you cannot rent the property.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If you can't pay your second can they only put a lien on your property. Can they take money out your bank accounts?

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If you are going for a modification well they combine your first and second into one laon

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Niicss's picture
Niicss | Joined: October 3, 2005 11:54 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Barbara,

In loan modification, a particular loan is modified. The lender will give you a new payment plan in order to pay off the mortgage dues. On the other hand, if you go for a refinance, then the lender can combine the first and the second loan into one.

Thanks.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I have the same situation as others here. I have and adjustable rate mortgage. I have an adjustable 1st with countrywide and a second with chase. I went to a company for help to get a loan midification. That company took my money,did nothing for 90 days and then closed up on me. Now I am speaking with countrywide and asking them to modify my loan. My condo is worth around $150K to $170K due to all the other condos that are forclosed or empty here in downtown miami. I owe about $254K for the first mortgage and $90K on the second.

I have pointed out that I can just walk away like my neighbors are doing but we would like to stay in this condo. I told them that I had read many terrible things about them on the internet as far as them offering helpfull loan mods but I am skeptical. I am $200K upside down. I will be sending them everything that they asked for to start the process but what should I do to handle the second mortgage with chase? Could I offer to go into bankruptcy and tell them I can offer them $9K to settle the debt? Or should I just ignore them and let them chase me? What would you do in my situation? I am already 90 days past due on both. We had some serious problems financially but now things are getting back to normal but not enough to get us current.

I want them to drop the loans down to what the property is worth. I am not sure how to do this even though I have a professional brokers opinion on the current value..

Please advise me as what you would do. This is not my normal thing....

Thanks.

Mike in Miami, fl.

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jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi Mikeinmiami,

If you do not pay the mortgage dues to the second lender, they will have the rights to foreclose your property. However, in order to foreclose the property, they will have to pay off the mortgage dues of the first lender.

I would suggest you to speak to your second lender and try for a loan modification with them as well. You can also speak to them about the amount you can offer them in order to settle the debts.

Thanks

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

hi my question is that i also have 2 loans and my 1st loan made a modification but my 2nd loan is like 40,000 dint work with me and they desided to referead to a a collection agency so what would happend if i deside to just pay my 1st loan can they take my house away any sugestions or its better if a short sale it because i only afford to pay my 1st loan.

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adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi julis,

As your second mortgage lender has charged off your mortgage to a collection agency, you will have to pay the mortgage dues to the collection agency. The second lender will no longer collect the dues from you. In this situation, though you short sale the property, you will still be liable to pay the dues of the second loan.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I'm located in the state of Washington, and have seen my fair share of mortgage company's that wont budge. We modify loans for people on their first and second loans. Most of our clients are ones that haven't been able to modify by themselves. I've been been in the loan modification business for almost 3 years. We know most of these banks and have good contacts with them (except HomeEQ). We don't charge a huge upfront fee just $250 for the paperwork and filings. We only get paid after we have approval from the lender. So if your not getting any luck or need advice call my office 425-877-1218. Don't fall for stupid huge upfront fees, they get your money and never call you back.

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devidas_padir's picture
devidas_padir | Joined: March 1, 2009 12:17 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

It is most important to sign a deal with proper care as it is a mutual salvage program with little belief on either side. You have to keep the commitments. But if is the situation that has caused the problem, renegotion term is also in the market (Althoug success doubtful). You need to tell the truth that foreclosure is the only option left you are sincere enough. Also, you need proper justifications, an delay of payment may be clue to click at their side for a new turn.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I have 1st and 2nd mtg 1st 413000 2nd 100000. my house is beeing on sale from jan 2007 and last six months we are not paying anything. both bank cannot do the foreclosure or short sale. I have 2 gas stations with partners. but one is very bad other so so. It affect on my business If i do bankrupsy? What i supposed to do. just staying at home with out bankrupsy?.If i stay here and not doing anything what's going to happen?.
Thanks.

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adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi luke,

Did the lender give you any reason as to why he can't short sale the property?

As far as bankruptcy is concerned, if you file [url=http://www.mortgagefit.com/bankruptcy/chapter13.html]Chapter 13 bankruptcy[/url] just for the mortgage, it will not affect your business. Moreover, by filing chapter 13, you will be able to save your property. You can pay off the mortgage dues to the lender according to the alternative payment plan given by him and clear off the dues within 3-5 years.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Did the lender give you any reason as to why he can't short sale the property?
we talked 1st mortage they said we don't do shot sale or foreclosure according to the policy. 2nd mortage said, they need $30000 or some body needs to co-sign to take the responsibility of the rest of the money $70000 and also needs to sign the note both party to sell this property. buyer came give an offer $470000. 2nd mortage not let us to sell this property until we fullfill the abow condition.we have only one income since one year.
thank you.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

If you cannot fulfill the conditions given by the lender then [url=http://www.mortgagefit.com/know-how/filebankruptcy.html]filing bankruptcy[/url] would be a better option in your case.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi,
We have been out of our house since August 2008. It is currently in foreclosure because we had to file bankruptcy at that time (husband lost his job and our income decreased significantly). We desperately want to move back to our home and have almost worked out a loan modification with our first mortgage that we can afford. We are worried now because we realized that this does not include our [url=http://www.mortgagefit.com/second-mortgage.html]second mortgage[/url]. (We owe $210,000 on first and $64,000 on second.) Our house would sell for much less at sherriff's sale. Is the second mortgage company going to come after us after our Chapter 13 is over if we don't try to work something out with them now? We are afraid that we will not be able to afford the payments on the first mortgage and the second mortgage together. Please help us get our house back! Thank you!

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adonis's picture
adonis | Joined: October 22, 2005 05:04 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Welcome wag,

The second mortgage company will have the right to come after you if you do not work out a plan with them. You can try to negotiate with the second lender so that he lowers your payments which can help you in paying off the dues.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

i owen 260 in the 1st and 135 on the 2nd and my house is upside down value is around 250 now
the second morgage told me they gave up my account to a third party ,they dont know who they are so the cannot help me ,20 days later i received a letter from a collection agency saying the will represent the chase debt ,contact them or pay the the 135 000 check

so what will happen next... can they foreclusure,sue me ?

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Niicss's picture
Niicss | Joined: October 3, 2005 11:54 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi ibana

If you do not contact them and pay off the dues, the collection agency can sue you for the debt.

Thanks.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I understand this forum posting is old so I hope someone will read it. We bought a home three years ago with the same thing a 80 - 20 loan, the 1st mortgage is adjustable after two years and has gotten really high, the 2ed mortgage is fixed for 15 years and then balloons. The 1st is 270.00 the 2ed is 64.000.

We just worked out a loan motification on the 1st loan, they gave us a fixed rate of 5% for 25 years then ballons, our payments have been lowered 500.00 a month. We are so happy, but the 2ed loan just told us that they can't help us.

Our home is worth less then what we owe. The 2ed loan is 700.00 a week, and is around 12% on 64,000. I was trying to get them to lower the rate so we can pay around 400.00 a month, something we can afford.

Any advice, tips, etc? Are they just acting tough, what can they do, or cant do? This extra 64,000 is killing us, we have not made a payment on it in three months, if it was half we could swing it. Thanks, kimmy.

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Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Sorry I mean 700.00 a month. Thanks. (On second loan)

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smith.sussane's picture
smith.sussane | Joined: September 18, 2008 09:57 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi kimmy!

Welcome to forums!

$700 a month on second mortgage is really a lump sum amount. You did the right thing by appling for a modification with the second lender. But it would be your lender's discretion whether he would accept it or not. However, did they give you any reason as to why they won't accept your request for modification? I would suggest you to negotiate with them further and check out if they can offer you any option.

Feel free to ask if you have further queries.

Sussane

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pardescnn's picture
pardescnn | Joined: May 8, 2009 08:12 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

I have first (536000) second(123000). My home is worth 480000.
1st is not willing to do any modification as i am current on both.

I was thinking of stopping mortgage for 2nd so that they can
come back to me with some offer.

Is that a sound strategy? Otherwise I may have to go short sale route.

Please advise..

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sara's picture
sara | Joined: July 5, 2006 03:16 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi pardescnn,

The lender will offer you a loan modification based on your financial situation. If you deliberately stop the payments but cannot prove to the lender that you are going through a financial crisis, then the lender will not accept your request for modifying the loan. I personally don't think this is a good strategy.

Take Care.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

what will happen if we quit paying the 2nd mortgage payment? we are in the process of bankruptcy, but want to keep our house

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jameshogg's picture
jameshogg | Joined: December 20, 2005 02:58 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi gail,

If you stop paying the second mortgage dues, the second mortgage lender can foreclose the property or place lien on other properties. The second lender may even charge off the mortgage dues.

However, if you [url=http://www.mortgagefit.com/bankruptcy.html]declare bankruptcy[/url], then the lender will not be able to come after you for the payments as the court will issue an automatic stay on any type of action taken by the creditors.

Thanks

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

Here's whats happening to us. We have a first and second with the same mortgage company. I was forced to retire because of health problems. My income was cut in half. I kept paying both for a few months (by using savings). But finally realized that I the savings was disappearing and I would lose the house anyway. I tried to no avail to contact my mortgage company, but they would not talk to me. Last June 2008, I made my last payment on both mortgages. Then the phone calls started to come, but at first it was just people in collection and they would not talk about anything but me making my payments. I filled out the paperwork for the [url=http://www.mortgagefit.com/loss-mitigation.html]loss mitigation[/url] program. I did it on line, mailed it a couple of times and faxed it. After several months of no response, they finally modified my first, but has totally ignored my second. They stretched my loan out to 40 years and lowered my interest. It lowered my payments by $600. a month. But now what happens to the second? I tried to get them to address both loans at the time they were working on the first, but they would not listen to me. In the plan recently released by the Obama Administration, Making Home Affordable (MHA) there is reference to extinguishing second mortgages. What does that mean? Now I have the mortgage company calling daily about the second mortgage. I have told them I can't pay it. I just live in fear as to what their next move will be. It just doesn't seem like they would modify my first and then foreclose on my second. I owe 260,000 on first and 60,00 on the second. The home next door to me (same as mine) foreclosed about six months ago and resold for 120,000. Has anyone else had there first modified and not their second. I welcome any replies.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

My home is worth $230,000. I owe $490,000. I owe $375,000 on my first and 115,000 on my second. The second is with popular "garbage" mortage. I notified them I would be missing my first payment after two years of paying on time and the guy blew a fuse. For the past 3months they have been calling me on Sunday's before the mortgage was due. It did not matter that I was current in my payments they still called. I got in a shouting match with the guy because he kept demanding that I give him an answer when I can pay. When does the lenders actions cross the line if you cannot pay?

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brianmortgage1 | Joined: May 12, 2009 10:31 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

It was really very useful replies which all the menbers are giving and you will get the exact information regarding What happens if you stop paying your 2nd mortgage?

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Niicss's picture
Niicss | Joined: October 3, 2005 11:54 pm | Posts: 0 | Location: New Jersey | 00 Dollars($)

Hi,

To VickiB,

It is good that your lender is modifying the first loan. As far as the second loan is concerned, there are chances that lender would charge it off. A collection agency will then collect the dues from you. I would suggest you to contact your lender again and discuss your options.

To dallas,

Once you are delinquent on your mortgage payments, the lenders may start demanding the dues from you. However, they cannot cross the line or mis-behave with you.

Thanks.

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Anonymous's picture
Anonymous | Joined: June 8, 2004 01:06 am | Posts: 0 | Location: New Jersey | 00 Dollars($)

I have a 1st and 2nd mortgage. I am up-to-date on the first one and was recently approved for a loan modification. I am behind on my 2nd mortgage for few months now. Can the 2nd mortgage foreclose my house? Please advise. Thanks!

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