Posted on: 02nd Apr, 2009 03:28 pm
Aunt lives in Louisiana missed 3 months due to storms. Now has a mortgage charge off? What is a mortgage charge off first of all? What does this mean for her? Will she lose her home?
Hi MariaChase,
A mortgage charge off does not mean the debt has been forgiven. It means that the lender records it as a loss for accounting purposes as they think they cannot recover the balance loan amount. They write off the loan from their account and pass it to a collection agency for the recovery of the debt. Thus, your aunt will now have to make the payments to the collection agency. If she makes the payments regularly, the home will not be foreclosed on.
A mortgage charge off does not mean the debt has been forgiven. It means that the lender records it as a loss for accounting purposes as they think they cannot recover the balance loan amount. They write off the loan from their account and pass it to a collection agency for the recovery of the debt. Thus, your aunt will now have to make the payments to the collection agency. If she makes the payments regularly, the home will not be foreclosed on.