Posted on: 02nd Dec, 2009 03:58 pm
hi,
i'm hoping i can get some guidance on a specific situation. objective insight would be much appreciated:
-$200k first and additional $200k second mortgage on home worth maybe $200k
-current on all payments
-have assets in the form of cash and investments but need that to continue in retirement
question is, what are my options if i would like to walk away from the home without having the 2nd mortgage lender come after me for my other assets? is there any way this is possible?
thanks,
ben
i'm hoping i can get some guidance on a specific situation. objective insight would be much appreciated:
-$200k first and additional $200k second mortgage on home worth maybe $200k
-current on all payments
-have assets in the form of cash and investments but need that to continue in retirement
question is, what are my options if i would like to walk away from the home without having the 2nd mortgage lender come after me for my other assets? is there any way this is possible?
thanks,
ben
Hi Guest!
Welcome to forums!
If you walkaway from the property, both the lenders will have the rights to come after you for the payments. The first lender will foreclose the property and sell it off to recover his dues. You'll be responsible to pay the deficient amount to the first lender, if any. Also, you would be responsible for paying off the second mortgage dues.
Your credit will also be badly affected if the property goes into foreclosure. It will get lowered by 250 points and it'll remain on your credit report for 7 years.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
If you walkaway from the property, both the lenders will have the rights to come after you for the payments. The first lender will foreclose the property and sell it off to recover his dues. You'll be responsible to pay the deficient amount to the first lender, if any. Also, you would be responsible for paying off the second mortgage dues.
Your credit will also be badly affected if the property goes into foreclosure. It will get lowered by 250 points and it'll remain on your credit report for 7 years.
Feel free to ask if you've further queries.
Sussane
Thanks for the response Sussane.
I have a few follow-up questions: To what extent can the 2nd mortgage lender come after me for the deficiency? Can they seize bank accounts, savings, business assets etc?
Given the scenario that I am $150k deficient to the 2nd mortgage lender with the 1st paid off, how much will it be possible to reduce the deficiency through negotiations? I believe I can manage settling for 10% ($15k) but any more will be difficult. Is this possible?
Thanks in advance,
Ben
I have a few follow-up questions: To what extent can the 2nd mortgage lender come after me for the deficiency? Can they seize bank accounts, savings, business assets etc?
Given the scenario that I am $150k deficient to the 2nd mortgage lender with the 1st paid off, how much will it be possible to reduce the deficiency through negotiations? I believe I can manage settling for 10% ($15k) but any more will be difficult. Is this possible?
Thanks in advance,
Ben
Welcome back Ben,
If you do not pay off your second mortgage, the lender can garnish your savings/bank account or can place a lien on your other assets. As far as lowering the loan balance is concerned, it would be totally the discretion of the second lender. Depending upon your financial situation, the lender will let you know whether or not he would agree to your request.
If you do not pay off your second mortgage, the lender can garnish your savings/bank account or can place a lien on your other assets. As far as lowering the loan balance is concerned, it would be totally the discretion of the second lender. Depending upon your financial situation, the lender will let you know whether or not he would agree to your request.