Posted on: 22nd Apr, 2010 01:14 pm
we have a 1st and 2nd mortgage. we are current on both our payments as of today. its been harder and harder to meet the payments every month as our debt to earning ration is too high. we have a credit card debt of $30m and all maxed out with high interest. me and my husband makes good money but it all goes to the mortgage and bills and daily expenses just like everyone else. our bring home money is not enough to pay the 2 mortgages thus making me take an extra of between $500-600 per month out of our savings to pay the 2 mortgages thus resulting in almost a zero balance on our savings. we tried to ask for a loan modification on the first and second mortgage but neither one approved us due to our debt/income ration is too high. i also tried to ask for a debt consolidation and debt management program but none will give us a loan as we don't have no home equity nor a collateral to give. our last opion is to stop paying our second mortgage so i could use the payment towards the 1st mortgae and still be current on it. now my question is, will this make me still keep my house? i don't want to lose my house from foreclosure or get sued by the 2nd mortgage once i stop paying them. will they (2nd) give us a chance to negotiate to lower our payments in case we do stop paying them. (we are very current right now) . it seems that they will not help us unless we get behind on our payments first. we don't want to go collection either as our credit scores are in the higher 600's right now. pls. advise! i would not know where to get my next month's mortgage payment as my whole savings has been already exhausted. pls help!
If you stop paying the second mortgage dues, then the lender will be able to sue you for the dues. He can either foreclose the property or charge off the loan. In both the cases, your credit will get affected. I would suggest you to reapply for the loan modification once again and check out if your request gets accepted. If not, then you can apply for a deed in lieu of foreclosure and get rid of the property. However, it will lower your score by 250 points and you would be liable to pay off the second mortgage dues.