Dear Home Owner,
If you have (or had) a 2nd mortgage on your home, please read this letter carefully.
Millions of homeowners stopped paying their 2nd mortgages after the 2008 Great Recession. Contributing factors were plummeting home values, loss of income, Chapter 7 Bankruptcy filing and Loan Modifications on 1st mortgages. Some 2nd mortgages simply stopped sending monthly statements and homeowners believed their 2nd mortgages were “dead.”
Today home values have appreciated above their highs of 2007 and 2nd mortgages are “awakening.” Not only are they “awakening,” they are being sold to extremely aggressive servicing companies who aim to collect ALL past due payments, or simply FORECLOSURE.
In 2011, the Smith family was in financial distress due to the Great Recession. Their home value was plummeting, their income was cut in half, they were behind on bills and hadn’t made a mortgage payment to their 1st or 2nd mortgage in months. A relative suggested filing for Chapter 7 Bankruptcy for debt relief, so that’s what they did. Not only did Chapter 7 eliminate their unpaid stack of bills, but it also brought their 1st mortgage to the negotiating table and they were able to work out an affordable monthly mortgage payment using a Loan Modification. In a few short months, the Smiths went from drowning in debt to debt-free with a mortgage payment they could afford. Happy Ending, correct? Unfortunately, NO!
Fast forward to 2019, and the Smiths, who had not heard from their 2nd mortgage company since their 2011 Bankruptcy filing, suddenly received a foreclosure notice in the mail. How could this be? They assumed it was a mistake, but it was not. The 2nd mortgage had gone dormant for 8 years, all the while, collecting interest on unpaid payments. By the time the Smiths contacted Sternberg Law Group, the 2nd mortgage was demanding all past due payments (8 years or 84 monthly payments, plus penalties and interest) or foreclosure was imminent.
What did the Smiths do wrong? Simple, they assumed their 2nd mortgage was gone. The purpose of this letter is to make sure you are not making the same mistake the Smith family made.
Did I have a 2nd mortgage? Do I know for certain what happened to my 2nd mortgage? If you’re in any way unsure of the answer to these questions, please call Sternberg Law Group now for a free consultation.
We’re happy to walk you through a free consultation to determine if your home is at risk of foreclosure from a “Dead 2nd Mortgage.” Sternberg Law Group is dedicated to educating and helping homeowners make the best and safest choice for their future. If you or someone you know has any doubts about the status of a 2nd mortgage, give us a call. We are here to help!
The Sternberg Law Group
JOSHUA STERNBERG, ESQ.