Question: I have two mortgages on my home. The first was recently modified under HAMP. The 2nd lien holder sent me a letter stating that they do not participate in the government program and I was denied for a modification for 2nd. My house appraises to $300,000.00. My first mortgage is $330,000.00 after modification. I cannot afford to make my second mortgage monthly payments and am now 2 1/2 months behind. The 2nd bank is threatening to foreclose on my property even though I am paying my first mortgage. What can I do?
Response: The 2nd mortgagee (2nd lender) is an unsecured creditor because there is no equity left in your home to preserve the 2nd mortgagee’s interest. If they were to commence a foreclosure proceeding right now, they will incur fees and costs for foreclosure that they would not be able to recover. If the sale took place right now, the 1st lender would get around $300,000.00 that the home appraises to and would end up losing the other $30,000.00. The second lender would get nothing at all because everything would go to the first. Therefore, the second lender is in the worse situation. Some banks choose to extinguish these debts altogether or they might try to settle with you by agreeing to a haircut on the debt you owe them. Alternatively, just because the bank does not participate in the government program does not mean they cannot offer you their own traditional loan modification. After all, it is in their best interest to do so. It is in your best interest to conduct proper negotiations with the financial institution that owns your debt.
In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.
The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2012 Law Office of Svetlana Kaplun, P.C.
modification, making home affordable, hamp, mortgage modification, harp refinance, making homes affordable, modifications, home affordable modification program, home affordable refinance program, hamp program, home loan modification, loan modification guidelines, foreclosures, foreclosure listings, foreclosure homes, mers, foreclosure settlement, foreclosure homes for sale, free foreclosure listings, foreclosure home, deed in lieu of foreclosure, foreclosure process, how foreclosure works, home foreclosure, foreclosure radar, bank foreclosure, home foreclosures, foreclosure listing, hud foreclosure, foreclosure laws, short sale vs foreclosure, stop foreclosure, totally free foreclosure home listings, foreclosure help, free government home foreclosure listing, free listing foreclosure home sale, free foreclosure listings with pictures, fannie mae foreclosure, independent foreclosure review, lawyers, power of attorney, personal injury attorney, attorneys, power of attorney form, durable power of attorney, power of attorney forms, criminal attorney, attorney search, medical power of attorney, free power of attorney, bankruptcy attorney, power of attorney template, power of attorney form download, durable power of attorney form, free power of attorney forms, general power of attorney, free printable power attorney form, lasting power of attorney, tax attorney, free power attorney forms, divorce attorney, ace attorney, disability attorney, attorney jobs, enduring power of attorney, attorney at law, patent attorney, free power of attorney forms to print, real estate attorney, injury lawyer, personal injury lawyer, defense lawyer, criminal defense lawyer, the lawyer, accident lawyer, a lawyer, criminal lawyer, motorcycle accident lawyer, rocket lawyer, bankruptcy lawyer, divorce lawyer, ask a lawyer, find a lawyer, lawyer referral, car accident lawyer, family lawyer, lawyer search, lawyer find, lawyer ratings, lawyer referral service, immigration lawyer, dui lawyer