Second Mortgage Lender Trying To Collect

[hardtcam]

:My question involves a foreclosure in the State of: Co

My home was foreclosed on in April 2006. We got a 2nd mortgage on it October 2005. We notified the 2nd that the home was being foreclosed on and they said that it was not secured by our property. I have the original documents and it states that the property is the collateral.

Long story short, the home is bank owned and has failed to sell numerous times and now the second ( after 2 years of no contact from them) has sent a collection company to collect. Do I have to repay this?

[Mr. Knowitall]

Okay... what part am I missing. You borrowed money, you didn't pay it back, your lender wants to be repaid, and the reason you believe you shouldn't have to repay the loan is... ?

[zronn]

The reason is that the loan was secured by the property.

This is a great forum and I have seen some very informed answers.
I have also seen some that appear to be shooting from the hip and assumptions rather than well thought out.

Grant it those answering are doing it for free, but if it is not well thought out or does not quite hit the target, it really isn't of much service.

Being snide doesn't serve anyone, including the one making the comment.

-R

[LawResearcherMissy]

The reason is that the loan was secured by the property.

That doesn't release you from your debt.

[zronn]

In some states it does.

[aaron]

Name them.

[jkatz]

Let me take a stab at this.

I deal with all too many of these "broken questions" so I can understand layman gibberish. (no offense -- hardtcam )

Your Sr. Lien foreclosed. Your Jr. Lien(s) coming to collect. You want to know if you owe the money. The answer is yes. If its more than 9k then they'll probably try to take you to court if you don't pay. Attachments, garnishments and all kinds of nasty. Get an attorney. Then all you have to do is come to some sort of settlement. Good luck.

[foreclosurefish]

In Colorado the lender can sue you for a deficiency judgment, and the statute of limitations for promissory notes (like your second mortgage) is six years. Unfortunately, it looks like you're a bit stuck now.

You can always try and go the debt validation/dispute route, hoping that the collection agency or original creditor lost all their records and are just betting that you will agree to pay them. In fact, debt validation is probably a good idea with any debt that ends up with a collection agency, just as a matter of principle.

Otherwise, depending on how much you owe, you can try working out a settlement. If you have some cash on hand, you can try negotiating the balance as far down as possible. If not, you can work out a monthly payment plan.

Eventually, they may try to sue for a judgment. In that case, you can try all sorts of creative legal defenses and maneuvers, but that most likely just delays the inevitable. You could try some kind of court-ordered settlement talks, as well, if it goes that far.

You might be best served by trying to request proper validation of the debt and then work out some sort of settlement if they are able to validate.

[jkatz]

Great post. Really good information. It is important! We always find that our clients benefit from setting up arrangements with the lenders because then there is no ambiguity about what will happen during that statue of limitations corresponding with the areas they live in. It's there. It's set. Either they agree to what the lenders are willing to accept or they take a chance on the foreclosure roller coaster with fear around every bend. Garnishments, bank levies and bears, Oh'MY!

Best wishes,

[OhMy]

Garnishments, bank levies and bears, Oh'MY!

uh oh, Now what did OhMy have to do with this? lol