Can they foreclose if I only default on my home equity loan, not my first or second mortgage?

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I’m being forced to relocate for my job, and I’m trying to avoid foreclosure or a short sale- I’d like to try to keep current on as much of my debt as possible. My home is currently worth less than half of what I owe (in florida). I do not qualify for refinancing because ratio of the value of the house to loan value. The notes are held by Freddie Mac. I am hoping that they will write a portion off, with the understanding that I’m still paying on a value far higher than I could sell for. (Mortgages worth $ 17K, HELOC of $ 45K, current home resale value ~$ 110K. I just want to be able to rent it and keep my head above water. Help.

6 Comments
  1. Reply
    Researcher
    May 17, 2011 at 11:29 am

    A home equity loan is another mortgage so you have three loans on a single piece of real estate. Wishing they will do anything for you without a contract is a dream. You need to get to your banker like yesterday. I have a couple friends in similar situations and they got refied, the 2nd written off and now only owe 45K on the property and are paying 850 a month. It is a dream. I on the other hand can’t get a refi because I have kept my payments up and didn’t get loans that I couldn’t pay off or really go beyond a reasonable amount in case the market failed. Silly me.

  2. Reply
    loanmasterone
    May 17, 2011 at 11:31 am

    Any lender in any lien position may start foreclosure procedure against you for failure to pay your monthly mortgage payment to them as agreed by the contract you signed with them.

    As far as writing off your mortgage or any portion of your mortgage because you house now is worth less than what you paid for it is slim. If the house had appreciated in value would you offer the lender an additional amount of equity in the property. I doubt it. Therefore since the appreciation did not go in your favor why would the lender write off any loans against the property?

    You might request of your lender about a modification of some type. They could have a program that might benefit you. You will only know if you ask.

    Apparently refinancing is out of the questions because the loan amounts are more than the value of
    your property.

    I hope this has been of some benefit to you, good luck.

    “FIGHT ON”

  3. Reply
    Carol
    May 17, 2011 at 11:54 am

    Yes they can. Home equity loans, home equity lines of credit are all mortgages. As such, they can foreclose if you don’t pay.

    Good luck.

  4. Reply
    Realtoratheart
    May 17, 2011 at 12:15 pm

    Make no mistake, if you default on any loan that has the property as collateral, they can foreclose.

  5. Reply
    Doctor Deth
    May 17, 2011 at 12:17 pm

    why would it be a short sale if you have 40k+ in equity?, which should also be plenty fo equity to refinance with – you must not be telling everything accurately, because you make no sense

    you say the home is worth half of what you owe which would make the home value $ 30k, but then you say the current resale value is $ 110k – which is it???

  6. Reply
    Pengy
    May 17, 2011 at 12:49 pm

    Any of the afore mentioned can foreclose on you, the home is the collateral

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