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Old 04-15-2008, 05:01 PM
 
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Do we still owe on the 2nd mortgage? It was with the same company as the first and we got it at the same time as the first...

anyone know? They are telling me the 2nd was an unsecured loan and we still owe the balance even though we returned the house to the bank.
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Old 04-15-2008, 05:47 PM
 
Location: central, between Pepe's Tacos and Roberto's
2,086 posts, read 6,097,275 times
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Only if the second was a purchase money second. If the second was taken out after the purchase then it is full recourse.
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Old 04-15-2008, 05:55 PM
 
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We did an 80/15 loan. So, we did take out the second at the same time as the first...so we do still owe the 2nd?
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Old 04-15-2008, 08:15 PM
 
Location: central, between Pepe's Tacos and Roberto's
2,086 posts, read 6,097,275 times
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If AZ is truly a non-recourse state, and the second was used to help purchase the home then you will not owe any money on the second. I know for a fact that CA is a non-recourse state and that is how it works there.

Keep in mind that this applies to the first as well. If both loans were taken out to purchase the home than you shouldn't have any issues. If either loan was refinanced into then you would likely owe on both of them, depending on the value and loan amounts.
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Old 04-15-2008, 08:48 PM
 
Location: Buckeye, AZ
14 posts, read 81,912 times
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I live in Arizona and went to see a real estate lawyer regarding this same question. The lawyer told me the same thing that Daddys///M3 is saying above; No recourse for the original purchase loans. It's a different story if you refi'd or took out a HELOC, like I did :-(.
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Old 04-15-2008, 08:55 PM
 
Location: Buckeye, AZ
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Who is saying that you still owe the balance on the 2nd?
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Old 04-15-2008, 09:54 PM
 
6 posts, read 89,246 times
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Quote:
Originally Posted by brhinehart View Post
I live in Arizona and went to see a real estate lawyer regarding this same question. The lawyer told me the same thing that Daddys///M3 is saying above; No recourse for the original purchase loans. It's a different story if you refi'd or took out a HELOC, like I did :-(.
Both of the loans we had were original purchase loans.
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Old 04-15-2008, 09:55 PM
 
6 posts, read 89,246 times
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Quote:
Originally Posted by brhinehart View Post
Who is saying that you still owe the balance on the 2nd?
The lender continues to send us a bill for the second mortgage.
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Old 04-15-2008, 10:34 PM
 
Location: Buckeye, AZ
14 posts, read 81,912 times
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Quote:
Originally Posted by jungle216 View Post
The lender continues to send us a bill for the second mortgage.
I guess they can bill you all they want, but probably can't do much legally like get a deficiency judgment against you to garish wages or file a lien against other property. You might want to sit down with a lawyer to review the specifics of your case, especially if you have other assets or high income. If it were me, I wouldn't worry about it unless they actually file a lawsuit.
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Old 04-15-2008, 10:34 PM
 
Location: central, between Pepe's Tacos and Roberto's
2,086 posts, read 6,097,275 times
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Quote:
Originally Posted by jungle216 View Post
The lender continues to send us a bill for the second mortgage.

Have you talked to a RE lawyer yet? I'm sure for a couple of hundred bucks they could write up a cease and desist letter for you. It should be completely legally binding and if the lender did not abide then you could likely pursue further legal action.
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