Posted on: 06th Nov, 2010 08:08 am
I can't find anything on the internet about my situation. I have a HELOC on a property of mine, which has now become a rental property. They required paying off the first mortgage when I got the HELOC, therefore, the HELOC is the only mortgage on the property. I am thinking of defaulting because I owe twice what's it's worth now. Do I have the option of requesting a 'deed in lieu' with a HELOC, or is it completely different from a regular mortgage company? If they foreclose, do they also have recourse to collect the remainder of the debt? (California) Is it true the primary lender (which in this case would be the HELOC) can only do one means of collection? Can they choose NOT to foreclose, and instead seek a judgment for the entire$90,000? I own another property with about $80,000 of equity. Can they place a lien on that one? How about my IRA? Another question about 'deeds in lieu', if they accept a 'deed in lieu', can they also seek collection of the balance remaining after the sale? or pass that portion over to a collection agency?
underwater2
underwater2
hi guest,
you can apply for a deed in lieu of foreclosure with your heloc lender as it is the only mortgage on your property. if the lender is convinced by your financial situation, your request will be accepted. if this option is accepted, then you won't be liable for paying any deficient balance.
if the lender forecloses the property, he won't be able to come after you for the deficient balance as it is the only mortgage on your property and california is a non-recourse state.
you can apply for a deed in lieu of foreclosure with your heloc lender as it is the only mortgage on your property. if the lender is convinced by your financial situation, your request will be accepted. if this option is accepted, then you won't be liable for paying any deficient balance.
if the lender forecloses the property, he won't be able to come after you for the deficient balance as it is the only mortgage on your property and california is a non-recourse state.
I've seen heloc loans get charged off just like a credit card on 1st mortgage position. Usually if it goes this far you can still negotiate to settle the amount owed in total or past due. You should contact your lender and find out what type of assistance they can offer you.