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Old 02-27-2009, 12:45 PM
 
3 posts, read 19,762 times
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Advice needed urgently!
Currently owe $400,000. Home is now worth $250,000. First mortgage is $323,000. 2nd mortgage is $80,000. Having difficulty with payments. First mortgage adviced me to stop paying 2nd mortgage and pay them first because the 2nd mortgage will not foreclose on the home if they do not stand to make anything from the foreclosure. Is this true????
This is my first home in VA. I want to stay in it. Please help.
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Old 02-27-2009, 02:36 PM
 
930 posts, read 2,338,227 times
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Do you want advice on how to stay in your house or do you want actual advice?

Re-prioritize your "wants" and sell the house with payments you cannot afford.
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Old 02-27-2009, 03:00 PM
 
Location: Montrose, CA
3,031 posts, read 8,664,240 times
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You can't afford it. Sell it and rent or get something that's within your budget. Or hey, maybe pay what you promised to pay in the first place? Brilliant!

Shouldn't have overextended yourself in the first place.
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Old 02-27-2009, 03:57 PM
 
20,185 posts, read 22,873,380 times
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LOL... its not true... if you default on your second mortgage you can get your home foreclosed since your home is COLLATERAL to your loan terms... the first mortgage is trying to squeeze every penny out of you before the second mortgage takes your home... real nice, huh? You might want to talk to the government, they are trying to redo mortgages, etc. (i.e. steal from me to give to you)...
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Old 02-28-2009, 10:24 AM
 
3 posts, read 19,762 times
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WOW! I'm glad I gave you all an avenue to vent. Thanks!
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Old 02-28-2009, 10:35 AM
 
1,788 posts, read 4,610,397 times
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Quote:
Originally Posted by daksdVA View Post
WOW! I'm glad I gave you all an avenue to vent. Thanks!
I think the financially responsible public is getting really sick of paying for the financially irresponsible public. Any question like yours is going to be seen as someone who bought more than they could hope to pay off, and is now looking for an easy way out. Whether or not that is the case, the reactions seen here are mild to a lot that I've seen.

And really if you bought more house than you could pay for, with unwise mortgage terms, then I agree with them and don't have much sympathy for you. On the other hand if you didn't buy frivolously and had a spousal death or lost your job or something out of your control then good luck to you.
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Old 02-28-2009, 10:47 AM
 
7,101 posts, read 26,403,033 times
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If you can't bring yourself to sell, pay the first mortage first. The second lender can file a lien against the house in case you sell, but I think the the first lender is the one that actually will have the title in case of foreclosure.

Of course, I am sure that there are all sorts of exceptions, and it may even depend on what state you are in.

That's a hunk of money to tie up in a house.
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Old 02-28-2009, 10:50 AM
 
Location: Prescott
82 posts, read 245,231 times
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I would talk to the bank and ask if they will refinance.Of course they normally won't if you have zero equity and your credit isn't perfect. I think Fannie Mae is helping people refinance if you meet certain criteria. You might want to do some research online about the programs out there. I was in the similiar situation as you, and I just sold the house on a short sale. The first mortgage lost a lot but agreed to the sale the 2nd mortgage agreed to release the lien for about 7K but I would be responsible for the rest of what I owed after closing (about 60k..ouch). I decided to sell the house anyway pay them 7k and worry about paying back the rest of the second after closing. I am still waiting for the 2nd to be sent to collections, so I can negotiate a price because I will not pay 60k back. The bank still has very nasty threatening people call my house and leave messages... My credit is absolutely in shambles, but I think it will recover after a few years. I have a history of paying bills off and ontime for many many years. I couldn't help that the market took a dump. I bailed and am suffering the consequences. You too will recover, but if you want to keep your credit..try and refinance and keep the payments current if you can until you can no longer then sell it if unable to refinance and can no longer afford...just remember some landlord's check credit and credit card companies will probably cancel your cards as they did mine so try not to rely on them too much. Good Luck and move on with your head high and a plan and you will make it through...you just have to believe that.
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Old 02-28-2009, 01:36 PM
 
4 posts, read 16,792 times
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I had sort of the same question. My husband became disabled two years ago and our income dropped dramatically as you can imagine. We stayed afloat for awhile by spending all of our savings and retirement accounts. Our first mortgagor has just agreed to a loan mod, but won't consider a refi adding in the second mortgage. We could afford the new 1st mortgage payment (for 40 years!!!! -- ouch!), but there's no way we can pay the second too. My husband is optimistic that we can work still work this out and stay in our home, but I'm really getting stressed. We've been here for 18 years and only had 10 years left to pay on our first and 8 years on the second. We aren't deadbeats who took out loans we knew we couldn't afford. We were paying our bills very comfortably until DH became seriously ill. Now, with him sick and me working like a dog, I'm ready to just pack up and move out. Being enslaved to these mortgages just isn't worth it to me. Of course, I realize I can't do that and will have to continue to fight my way through this mess.

We are supposedly working with Neighborhood Works (gov't sponsored program for people in mortgage crisis), but I have to say they haven't done anything except tell us to "not worry about it." The first loan modification was all negotiated by me. So, for those of you who think the government is going to help us, be prepared to help yourself.

I'm rambling/venting. But, my question is this. I have to deal with the second mortgagee now. Do I understand correctly that the second mortgagee CAN initiate foreclosure proceedings against us even if we are current on our first mortgage? How would that scenario play out? We still have equity in the house, although home prices are dropping everyday and home sales are way down. If they foreclosed and we had to sell, what if there wasn't enough money to pay them off? I guess we'd still owe them the money. OMG. What a mess.

Maybe it's time to consult a bankruptcy attorney, although that's not something I ever wanted to do. Any advice is welcomed.
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Old 03-18-2009, 12:22 PM
 
3 posts, read 19,762 times
Reputation: 14
Thank you all for the advice and recommendations! I truly appreciate it!
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