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HELOC

home equity line default

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Question:  I work for the bank that holds my home equity line. I do not want to default on it. (It is only a 10k heloc) Can I just continue to pay on it if my mortgage loan is defaulted on?

 

Answer:  You are free to continue to pay on it if you want. However, you have to realize that sooner or later, the bank in first position will foreclose on you.  And if there is no equity in the home, more than likely your 2nd will be wiped out, regardless if you made your payments or not.  To me, it doesn’t make sense to make payments on the 2nd if you are not making payments on the 1st mortgage.  In the end,  your bank will still want the $10k that you borrowed, which you can gladly workout some sort of settlement with them until it’s paid off.  Offer them payments over 10 years like you agreed on or give them $2000 upfront as a full payoff.  They’ll treat it just like any other defaulted loan even if you work there.  What you do want to try to avoid is a deficiency judgement.  You want to try and get a full satisfaction so they can’t file a judgment against you.

Used HELOC as down payment on house

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Question:  I bought a house in 2005. I got a mortgage on the house and put down 10%. The bank also gave me a heloc at the same time on the same home. I did not receive any of the $…the bank took as further down payment. Looking back it doesnt make sense that the bank did this. My mortgage broker was the one whom recommended. Was this legal?

Filing for bankruptcy. My second mortgage, now my first?

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Question:  I am in the process of filing for bankruptcy. I am filing chapter 13 so I can have my second mortgage, which is a line of credit through Bank of America, dismissed. My attorney just called and said that because my first mortgage was obtained after my HELOC, only because we refinanced, that the court may deem the HELOC as my first mortgage. Is this possible?

I have a home equity line of credit and am delinquent.

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Question:  I have a home equity line of credit and am delinquent 1200. The credit union has a copy of the mobile home title, but is not listed as security interest holder. I have made arrangements to catch up the past due balance. We have not signed any mortgage papers. Can they foreclose based on a copy of the title. They want us to add them as security interest holders and said that also included our tax lots.

Answer:  – Anyone can foreclose if they have a lien on your property. If you borrowed money from a HELOC that is attached to another property to buy this mobile home, then the credit union will foreclose on the property attached to the lien that was pledged as collateral for the loan.

HELOC in Maricopa County

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Question: I foreclosed on a home in Maricopa county Arizona as of September 15th. I have a Heloc loan which i got with the purchase of the house. They are now saying i still owe them and that the Heloc is like a credit card and i will keep owing. What should i do?

Answer: -Well, you can try to settle the debt with them and pay them a fraction (5% -10%) of the original loan amount, you can do nothing and hope they issue you a 1099 in which you will have to pay taxes on that money you received, or they will file a deficiency judgment against you in which they can garnish wages and so forth until that amount is paid. If it goes that far, most people will file bankruptcy and either get it wiped out completely with a Chapter 7 or agree to pay the lender a certain amount (5% – 10%) over a period of time with a Chapter 13.