Upside Down Mortgage

Mortgage Modifications Law

Question: What happens on a second mortgage default?

I got behind on my second mortgage (my first is current) after my wife lost her job but she has recently re-gained employment. Now the second has been turned over to a law firm, who is asking for us to catch up payments (with no loan forebearance, modification of any kind) and if we don't comply, they will continue with the legal process, which I understand to be a judgment.

What happens at this point? I have been told by some that if a judgment is entered by your second mortgage lender, they can't really do much unless the house sells at some point. Is this correct? With the current market conditions, my house is underwater, so "short-selling" would only benefit the first mortgage lender.

Can they attempt to seize assets (what little I have)?

Answer: I recommend that you talk to an attorney who specializes in real estate law immediately.

The holder of the second has substatntial legal rights.

The holder of the second can foreclose if he chooses to do so. Essentially the holder of the second could take your house in foreclosure subject to the mortgage of the first.

I recommend that you talk to an attorney immediately.

The Law Office of New Horizon and Associates Part 4

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