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If I lose my home to foreclosure do I still have to pay back second mortgage?6 years ago - 8 answers
You are still responsible for the amount of money you were given. You can make payments, let them garish your wages, or whatever. But, no, you do not pocket the money and walk away.6 years ago
Contact an attorney (free consultation)by M C - 6 years ago
No, you won't.
When a home forecloses, there is generally a "trustee's sale" at the courthouse. Whatever money is recovered from this sale of the home is split between the lienholders on the home. Taxes are paid first, then the 1st mortgage, then the 2nd mortgage. If there isn't enough money to pay the 2nd mortgage, the company just loses out. That's why the interest rates you pay on a 2nd mortgage are higher- they are riskier for the bank.
I'm sorry you are going through this. You are certainly not alone.
Yes, your still responsible for any remaining debts on the property after it has been sold.by AJ - 6 years ago
I work in the foreclosure dept. at the bank. I have no idea where the other people are getting their info. The bank would go bankrupt if we are not collecting the balance from the customer. We are in business to make money not lose money. We just don't lose out like people think. We come after customer's and go legal to garnish their wages.
Source(s)by alandra555 - 6 years ago
Yes, of course.
The second mortgage just means that, in the event of foreclosure, any proceeds remaining after the full obligation of the first mortgage is repaid, such proceeds begin to reduce the outstanding obligation due under the second mortgage.
You are still obligated to pay any remaining obligation under the second mortgage after foreclosure.
Yes, you are responsible for all the debts.
That means anything left owing on the first mortgage after the foreclosure sale, as well as any further mortgages.
They have no more collateral, but the debt is stil there, and they will keep trying to collect as long as the debt is outstanding.