Posted on: 13th Feb, 2009 03:05 pm
here is my situation:
- i bought house in 2005 about $600k (80% and 15% + 5% down)
- 1st and 2nd mortgages with wells.
- later on i refinanced 2nd mortgage with some other lender and took some money out from home equity.
- now my house value is under water (300k) just like everybody, so i'm unable to pay the mortgage payments starting this month. 1st mortgage company ask me to try for short sale.
my question is : i would like to know what are all options available for me.
if i chose foreclosure : what will happen to second mortgage since he is not the primary lein?
any comment, advise would be greatly appreciated.
- i bought house in 2005 about $600k (80% and 15% + 5% down)
- 1st and 2nd mortgages with wells.
- later on i refinanced 2nd mortgage with some other lender and took some money out from home equity.
- now my house value is under water (300k) just like everybody, so i'm unable to pay the mortgage payments starting this month. 1st mortgage company ask me to try for short sale.
my question is : i would like to know what are all options available for me.
if i chose foreclosure : what will happen to second mortgage since he is not the primary lein?
any comment, advise would be greatly appreciated.
Hi RP!
Welcome to forums!
If your first lender forecloses the property, you will still be liable to pay off the second mortgage. Though the second lender is not the primary lien holder, he still has the rights to recover his debts.
As far as other options are concerned, you can look out for short sale, deed in lieu or loan modification. Lenders generally accept the request for any of these options only when you are delinquent on your payments. You will have to write a hardship letter to the lender and apply for anyone of these.
When you are applying for a loan modification, you will have to apply to the lenders separately and check if they accept your request. If the first lender goes for a short sale, you will still be liable for the deficient amount resulting from the sale of the property as well as for the second mortgage. In case of a deed in lieu, the first lender will forgive the deficient amount resulting from the sale of the property but you will have to pay off the second mortgage.
Feel free to ask if you have further queries.
Sussane
Welcome to forums!
If your first lender forecloses the property, you will still be liable to pay off the second mortgage. Though the second lender is not the primary lien holder, he still has the rights to recover his debts.
As far as other options are concerned, you can look out for short sale, deed in lieu or loan modification. Lenders generally accept the request for any of these options only when you are delinquent on your payments. You will have to write a hardship letter to the lender and apply for anyone of these.
When you are applying for a loan modification, you will have to apply to the lenders separately and check if they accept your request. If the first lender goes for a short sale, you will still be liable for the deficient amount resulting from the sale of the property as well as for the second mortgage. In case of a deed in lieu, the first lender will forgive the deficient amount resulting from the sale of the property but you will have to pay off the second mortgage.
Feel free to ask if you have further queries.
Sussane
Thank you for your sugession.
Hello RP,
I am agreeing with smith.sussane, you should look out for short sale. Recession badly affects house prices. Since last year houses prices comes to half of their original price, as there are no buyers for them in the market. I think you must consult with professional real estate agent specialized in Lease option Homes for Sale and provides advanced lease option tools.
[Link deactivated as per forum rules. Thanks.]
I am agreeing with smith.sussane, you should look out for short sale. Recession badly affects house prices. Since last year houses prices comes to half of their original price, as there are no buyers for them in the market. I think you must consult with professional real estate agent specialized in Lease option Homes for Sale and provides advanced lease option tools.
[Link deactivated as per forum rules. Thanks.]
I have one more questions on short sale.
Just in case if I do short sale, I know second mortgage company will try to get the debts from me. Do you think they will come after me to recover money from my personal accounts ( 401 etc )? I live in California.
Just in case if I do short sale, I know second mortgage company will try to get the debts from me. Do you think they will come after me to recover money from my personal accounts ( 401 etc )? I live in California.
Hey Guest,
The second mortgage lender can garnish your wages or your savings account but as far as I know, retirement accounts are exempt from garnishment.
The second mortgage lender can garnish your wages or your savings account but as far as I know, retirement accounts are exempt from garnishment.
i agree with adonis. your 401(K) investment ought to be safe.
