Posted on: 31st Mar, 2010 06:39 am
Is a line of credit that is tied to the home considered a 2nd mortgage? My husband passed away his name is on the line of credit I am only on the deed. I can no longer afford to pay the line of credit. What should I do? I did get a modification for my first but just cannot do the 2nd. Can they forclose or garnish my wages? I am in florida.
evelyn, home equity loans are second mortgage liens, indeed.
as for what may happen...as long as you maintain your first mortgage payments, you'll undoubtedly be able to remain in the home as long as you want. what will probably happen with the other lender is that they'll call you on a regular basis, seeking payment. please take the time to speak to them to fill them in on your predicament. that won't stop the calls, but they may become less frequent once they know you're in a bind. ultimately, if they don't get payments for an extended period of time, they'll "charge off" the account. in other words, they'll assume that you're not going to pay ever again, and they'll take the loan off their books - their financial records. that, of course, does not eliminate your liability to pay, but it verifies for them and for their shareholders, etc. that you aren't paying. someday, because their lien will remain on the home, they'lll get paid, presumably. once you sell the home, if you do, their lien will need to be paid off in order for the sale to happen. of course, if that's too soon, then negotiations will need to take place to seek a reduced payoff from them.
i just wrote a lot up above...i hope it isn't terribly confusing, though i know that for most of us, financial jargon can be most confusing. let me know if i need to elaborate on any of the points to further edify you.
as for what may happen...as long as you maintain your first mortgage payments, you'll undoubtedly be able to remain in the home as long as you want. what will probably happen with the other lender is that they'll call you on a regular basis, seeking payment. please take the time to speak to them to fill them in on your predicament. that won't stop the calls, but they may become less frequent once they know you're in a bind. ultimately, if they don't get payments for an extended period of time, they'll "charge off" the account. in other words, they'll assume that you're not going to pay ever again, and they'll take the loan off their books - their financial records. that, of course, does not eliminate your liability to pay, but it verifies for them and for their shareholders, etc. that you aren't paying. someday, because their lien will remain on the home, they'lll get paid, presumably. once you sell the home, if you do, their lien will need to be paid off in order for the sale to happen. of course, if that's too soon, then negotiations will need to take place to seek a reduced payoff from them.
i just wrote a lot up above...i hope it isn't terribly confusing, though i know that for most of us, financial jargon can be most confusing. let me know if i need to elaborate on any of the points to further edify you.
Thank you George, I do understand what you said I was told that sometimes the 2nd does forclose on the home I was very worried that they might do that, although if I sell the house now, The first would not be paid off completely. The homes in this area are not selling, and if they do usually in forclouser and that brings down the value of my home.
