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I was told this week while trying to refinance my 2 yr ARM that I had a lein on my current property that came from a defeciency judgement on a foreclosure from four years ago. I have never been notified of the judgement and had no idea that this could occur. Can a mortgage company place a $30,000 lein on my NEW property for the difference between the balance and sheriff sale amount on my four year old home mortgage? Why didn't this become a problem when I got the first loan on my current property? How did they even know that I bought a new house? I have finally rebuilt my credit after the foreclosure and now my loan consultant is telling me I will have to file bankruptcy to remove the lein from my current property. This seems so sneaky. Please advise- thanks, Sara
Can a mortgage company place a $30,000 lein on my NEW property for the difference between the balance and sheriff sale amount on my four year old home mortgage?
Yes. You owe them that money.
Quote:
Originally Posted by audreycat
Why didn't this become a problem when I got the first loan on my current property? How did they even know that I bought a new house?
When someone has a judgment against you, they will scan your credit report on a regular basis. They didn't notice it when you FIRST bought the house because the mortgage wasn't reporting on your credit yet. Once they see that you have bought something like a house that they can attach a lien on, they will do it. They want to make it difficult for you to do ANYTHING with that asset without paying them off first.
Quote:
Originally Posted by audreycat
I have finally rebuilt my credit after the foreclosure and now my loan consultant is telling me I will have to file bankruptcy to remove the lein from my current property. This seems so sneaky. Please advise- thanks, Sara
Or you can pay them back. It's not sneaky, they have every right to try and collect the money owed to them. Why did your previous house go into foreclosure? Why in the world would you get an ARM after previously having a house go into foreclosure???
Or you can pay them back. It's not sneaky, they have every right to try and collect the money owed to them. Why did your previous house go into foreclosure? Why in the world would you get an ARM after previously having a house go into foreclosure???[/quote]
I was 21 yrs old, post-military, pre-divorced, and VERY STUPID for buying the decrepit old house in the first place. We tried like crazy to do deed in lieu....
ARM was the only loan I could get after haveing a foreclosure. I thought my bad credit was my punishment for foreclosure. The plan was to pay everything on time for 2 years (which I did), up my credit scores (which I have), and get a new 30 yr loan with a decent rate (which I was doing until this came up)
How can I pay 30 thousand dollars??? I'm a single school teacher with two kids. I just don't see that happening. I think it's sneaky to tie themsevles onto a loan that they had nothing to do with and never notify me of anything that they were doing. Any other ideas?
ARM was the only loan I could get after haveing a foreclosure. I thought my bad credit was my punishment for foreclosure.
No, bad credit is one of the consequences of the foreclosure. Owing the remaining 30k is another consequence.
Quote:
Originally Posted by audreycat
How can I pay 30 thousand dollars??? I'm a single school teacher with two kids. I just don't see that happening. I think it's sneaky to tie themsevles onto a loan that they had nothing to do with and never notify me of anything that they were doing. Any other ideas?
You don't think it's sneaky to abandon your debt obligation on the previous property? You don't think that that you have anything to do with that other debt because you were "21 yrs old, post-military, pre-divorced, and VERY STUPID for buying the decrepit old house in the first place."
I think you were ill advised by your previous loan consultant who got you into the 2-ARM. Are you going to be able to carry the mortgage after the rate adjusts? Can you get a personal loan to pay off the 30k?
That mortgage company still made plenty money on me and my ingnorance. I paid a thousand dollar house payment for over three years and almost nothing came off the principal.
The concsequences should not be able to haunt me for life. I should have been told that this was a possibility. I should have been told that the lein had been placed.
I don't know what your motive would be for being hurtful and judgemental; it's not like you're going to get the money.
I have managed to get my credit in really good shape after the mistakes that I made by working hard and living very cheaply so that I could pay off my other bills. Now it seems my best bet would have been to file bankruptcy on the whole thing four years ago. I would be a lot better off than I am being faced with such an unsurmountable burden now.
I agree with the other posters-- it's not sneaky for someone to try and collect a debt that's legally owed to them. You're lucky you're able to file bankruptcy and you'll be even luckier if you're able to refi and hang onto your current house. Bad decisions have consequences. It's an inconvenient fact of life that we all have to come to terms with sooner or later. I agree with jinxor that you should try and pay off the debt. You could probably negotiate it down, if you demonstrate a willingness to honor your obligation. Good luck!
That mortgage company still made plenty money on me and my ingnorance. I paid a thousand dollar house payment for over three years and almost nothing came off the principal.
The concsequences should not be able to haunt me for life. I should have been told that this was a possibility. I should have been told that the lein had been placed.
I don't know what your motive would be for being hurtful and judgemental; it's not like you're going to get the money.
I have managed to get my credit in really good shape after the mistakes that I made by working hard and living very cheaply so that I could pay off my other bills. Now it seems my best bet would have been to file bankruptcy on the whole thing four years ago. I would be a lot better off than I am being faced with such an unsurmountable burden now.
I'm sorry if you feel that we are being mean. Please realize that nobody is being malicious, judgmental or purposely hurtful. We all make mistakes. Unfortunately, some actions have lasting consequences. I am really sorry to say this but it is naive to feel that "the concsequences should not be able to haunt me for life." Maybe somebody could have told you that a lien is a possible consequence of the foreclosure, but you are an adult and have responsibility to figure this kind of thing out.
It admirable that are working hard and learning to live frugally in order to pay off your other financial obligations. It is great that you have been working hard to fix your credit problems.
Yes, it may have been easier or preferable to file bankruptcy 4 years ago, but that is crying over spilled milk. There is no time machine to take you back 4 years. You are in the here and now. You have an 2-ARM that is set to adjust. You have a 30k lien on your property. You have some tough decisions to make regarding your financial future. You need to sit down and consider your options carefully. I hope you are able to negotiate and find some way to pay down that lien, but as goodbyehollywood said, you should consider yourself really fortunate if you are able to file bankruptcy to discharge your debt obligations.
I was 21 yrs old, post-military, pre-divorced, and VERY STUPID for buying the decrepit old house in the first place. We tried like crazy to do deed in lieu....
ARM was the only loan I could get after haveing a foreclosure. I thought my bad credit was my punishment for foreclosure. The plan was to pay everything on time for 2 years (which I did), up my credit scores (which I have), and get a new 30 yr loan with a decent rate (which I was doing until this came up)
How can I pay 30 thousand dollars??? I'm a single school teacher with two kids. I just don't see that happening. I think it's sneaky to tie themsevles onto a loan that they had nothing to do with and never notify me of anything that they were doing. Any other ideas?
Was the previous house in an ARM as well??? Never, ever take an ARM if you are on a tight budget. This is why the housing market is tanking right now.
If the only problem you'd face with walking away from a house was bad credit, there would be 50x more foreclosures. The bank lost $30k on your house. You are obligated to pay them back.
They are not tying themselves onto your loan, they're tying themselves onto your house. Now, they want the money. Maybe you could call and offer to work some kind of payment plan out?
Please, please, please do not buy another house unless you can get a fixed mortgage. They tried to sell me ARM's when I bought 2 years ago. An ARM is just a way to get you into a house you cannot afford.
Please, please, please do not buy another house unless you can get a fixed mortgage. They tried to sell me ARM's when I bought 2 years ago. An ARM is just a way to get you into a house you cannot afford.
If you are planning on moving within the ARM period (i.e. 5 or 7 ARM) then an ARM makes sense since you used to be getting a lower rate with the ARM. You could save money that way. If you're planning on living in the house "forever" then get the 30 year fixed. It's a gamble to say I'm going to get the ARM now and refi later when interest rates go down. What if they go up?
Yes, many ARMS were well-used by the financially savvy-- as they were intended to be. You could have bought in 2002, gotten a 1.9% option ARM and ridden it until 2004 or 2005, then refied into a 4.85% 30-year fixed. Tied to the LIBOR or COFI, you would have been paying an under-market rate for 3+ years in an appreciating market, then refied into the best fixed rate ever when the market began to soften.
It was a great ride, if you knew what you were doing or needed a tailwind until your income caught up. For those who used it as a last-gasp resort to buy a home that they really couldn't afford or were on the wrong side of the risk-reward curve, the results will be not so good. ARMS are always riskier, so caveat emptor.
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come on why are you guys so mean??
