The possibility of losing your home because you can’t make the mortgage payments can be terrifying. Perhaps you’ve had trouble making ends meet because you or a family member lost a job, or you’re having other financial difficulties. The pandemic has caused many families to be in financial distress.
If you have fallen behind on your mortgage payments, consider contacting Sternberg Law Group to discuss foreclosure prevention options. If you have a second mortgage on your home, [that is two mortgages on the same property], your second mortgage could also haunt you with the possibility of losing your home. Sternberg Law Group is here to walk you through a complimentary consultation, determine if your home is at risk of foreclosure from a second mortgage, and discuss options available to help you keep your home.
The first step is to figure out what happened to your second mortgage. It used to be common practice for people to buy new homes with both a 1st and 2nd mortgage. These types of purchases were commonly referred to as 80/20 or 90/10 purchase. For some homeowners, these mortgages were taken out over a decade ago, and it may be hard to remember what happened to it.
A: Many people think that if they’ve declared bankruptcy, they no longer need to make payments towards a second mortgage- that is NOT true. Unfortunately, Chapter 7 bankruptcy does not remove mortgage liens from your home. You cannot strip off a second mortgage that is partially secured by your equity in the home. If the value of your house is enough to pay even part of your second mortgage out of a sale, it is partially secured, and the court won’t remove the second mortgage through bankruptcy.
If you have not been making payments on your second mortgage, years later, you may find yourself suddenly with a large bill to pay. For example, if a dozen years ago you stopped paying your second mortgage after the 2008 financial crisis, you may not have even heard from the second mortgage in the time since then. As house prices appreciate in value in 2020, this is a financially sound reason for lenders to reclaim what’s owing to them. You may have paid off your first mortgage, but the accumulated debt and interest on the second mortgage is not only pending but a hefty cash settlements often prevails. This is where Sternberg Law Group can step in to help you avoid foreclosure and the loss of your home.
A: One option is a negotiated settlement offer. If your situation appears to be more than a temporary hardship, Sternberg Law Group may be able to help you reach a settlement offer with your second mortgage. This is a lump sum amount they’ll accept in order to close your loan, and this amount can vary widely in terms of a percentage of your existing balance. Another option may be Chapter 13 bankruptcy. This type of bankruptcy is a viable option for some homeowners to strip their second mortgages, but each case is different and we welcome the opportunity to work with you.
Regardless of the reason for your mortgage foreclosure anxiety, Sternberg Law Group wants to help you keep your home. We do this as a responsive, client-friendly law firm dedicated to helping individuals and families obtain debt relief. If you are having trouble making your payments, contact our knowledgeable team to discuss your options as early as you can. If you wait too long, you may have fewer options. Contact us now, here.
“Sternberg Law Group is a leading foreclosure law firm located in Los Angeles, California serving homeowners throughout California. With the pandemic and stay-at-home orders, we provide consultations via video conference and can work through the necessary steps with you without an in-person meeting. My team and I are ready to review your case and ensure you understand what your options are going forward” Joshua Sternberg, Founder of Sternberg Law Group