Question: i have a home in Maryland that has been foreclosed I had an 80/20 loan with the 20 being a line of credit. My mortgage company is asking for full amount 50,000 without budging and threatening to garnish my paycheck by taking me to court. Is there any way of stopping or slowing them?
Answer: – Yes, but you may not like it…
One way to stop the mortgage company is to file bankruptcy. Depending on your situation, sometimes this is the best solution. It’s always a good idea to sit down with an attorney who deals with situations like these and ask for help.
There are other alternatives as well, however it’s going to cost you money and more time. You could hire an attorney to talk to them. Banks typically don’t like to work with homeowners. But they will work with attorneys. Usually if you get an attorney involved, who is good and understands the real estate business, they can almost always work out a solution for both of you. It usually ends with you paying between 2% – 10% of the loan amount, which is a lot less than the full amount.
Banks understand their position. Many times they try to scare you into paying them. When in reality, they know that money is pretty much gone. So they want to make your life miserable. They also know that if you file bankruptcy they get NOTHING. Something is better than nothing and most banks realize this and why they will usually work out something with the attorney.
Now obviously this isn’t the case every time. There are always exceptions. There are certain time where banks won’t budge and are just plain stupid. Doesn’t happen very often but does happen. What I would do is try to offer a settlement with them. Tell them you’ll pay $2000 right now to settle the note and completely wipe out the debt. Make sure they know you are prepared to file bankruptcy because there is nothing else you can do. See where that goes.
One of my clients had this happen to them and I was working on the short sale. I had a buyer lined up and ready too. The loan which was a line of credit was sent to a collection agency which is common. They called my client every day and harassed him telling him they were going to foreclose and then slap a judgment against him. It was an $80,000 HELOC. I offered $8,000 and they wouldn’t budge AT ALL. After weeks going round and round with this guy, it made me so mad that I called the bank, told them the homeowner was going to file bk, that this collection agency was impossible to deal with and wouldn’t accept ANY offer.
The next day, I got a call from the bank saying they pulled the account from the collection agency and were ready to accept my offer. Anyway, sometimes you do get those kind of people. Even though your home in Maryland has already been through foreclosure, you can still try to work out something with them. That’s the best solution if you don’t want to file bankruptcy.