Question: I own a property outright which has no mortgage. There is an equity line of credit which has come due, which I can not afford to pay in total. I consistently made payments on the equity line until November of 2011. The bank asked me to offer them a settlement which I have done and suggested that I not make anymore payments on the equity line. This has been dragging on for months. The bank asked me to let them appraise the property and then they would decide on the settlement. Is this normal procedure? Can you shed any light?
Foreclosure University
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Yes, usually a settlement can take a few months to complete. Your biggest challenge is going to be the equity in the home. If the second lien holder sees the property has enough equity to pay them in full, it will be harder to get the line of credit settled for an amount you can afford. It might be worth having our team of settlors talk to your bank and see what they can do. We don’t charge you anything for doing this and we’ll be able to give you a better idea on what options you might have. What you don’t want to happen is have them foreclose on you. And yes, they can do that.
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