QUESTION
Are we obligated to pay the second loan on a foreclosure home?
Asked on Oct 24th, 2012 on Foreclosures - Florida
More details to this question:
About six years ago, our home went into foreclosure and we had a second loan on it. The first mortgage was paid off, but second was not. Are we obligated to pay the second note, if we no longer have the home?
6 ANSWERS
Bankruptcy Attorney serving Phoenix, AZ
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Law Office of D. L. Drain, P.A.
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The answer is "maybe". It depends on the state where the property is located, the type of loan and the type of real property. Talk to a competent real estate attorney in the state where the property is located.
Answered on Oct 24th, 2012 at 7:47 PM
Civil Litigation Attorney serving Federal Way, WA
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Stasch Law LLC
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The foreclosure satisfies the first mortgage. The second mortgage becomes an unsecured debt, and the bank can pursue for payment. Often, if they do, you can negotiate a reduction.
Answered on Oct 24th, 2012 at 7:47 PM
Criminal Defense Attorney serving Deltona, FL
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R. Jason de Groot, P.A.
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You are obligated on the loan unless and until you file a bankruptcy and the debt is discharged.
Answered on Oct 24th, 2012 at 7:46 PM
1 Award
Not if the money from the second was used to purchase the home. Otherwise, yes, you are liable for it.
Answered on Oct 24th, 2012 at 7:46 PM
Litigation Attorney serving Pearl River, NY
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Law Office of Bijal Jani
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Unfortunately, yes, if you did not have a agreed upon writing which would stop the 2nd mortgage holder from exercising its rights to collect under the mortgage.
Answered on Oct 24th, 2012 at 7:46 PM
Insurance Litigation Attorney serving St. Petersburg, FL
Partner at
Gallagher & Associates Law Firm, P.A.
3 Awards
Your leaving the home does not alter the lenders rights to collect from you on the second mortgage. While the collateral might be impaired, it looks like the note for your second mortgage is still in tact and they are fully permitted to sue you for the same.
Answered on Oct 24th, 2012 at 7:45 PM