What happens with 2nd mortgage and HELOC when you go through foreclosure & BK?

[discouraged]

I've tried searching and can't find the answer. Do they go away too? Are you still responsible for them? Can't find the answer. Please help.

Thank you.

[despritfreya]

Before bk: Once the 1st forecloses the 2nd (HELOC) can sue under the note. Since the collateral is gone, the HELOC becomes nothing more than an unsecured loan.

Once bk is filed: HELOC is listed on Schedule F and is geneally discharged just like any other unsecured loan or credit card.

Des.

[CCsAreEvil]

I've tried searching and can't find the answer.

Are you serious? There are a ton of threads on this topic.

What are your intentions? Are you walking away from the house? What do you owe on each of your 1st and 2nd? What's the current value of the property?

It's hard to give a good answer without you providing more information on the above questions.

So, the short answer, your 2nd/HELOC mortgage note will be included in your bankruptcy and discharged. You will no longer obligated to pay it (unless you reaffirm or other..). However, if you stop paying it, they can put a lien on the property and foreclose on it. Are you planning to continue to pay the 1st? Again, hard to answer without more info.

[discouraged]

I haven't paid on either the first or second or HELOC since June. House was originally $124,000 when I bought it 6 years ago. I owe 72,353 on 1st, 25,238 on 2nd and 5,914 on HELOC. The tax estimate is on $85,000 (which is a joke) and the CMA shows high end ranges in my neighborhood at 57,967, low end 52,125.

I also have a 19,000 home improvement loan on it. That is a neighborhood home loan and I know they will have to write it off. Feel very bad about that but at 57 I just can't find a job. I have applied everywhere.

No I am not keeping it. I was unemployed for over a year, have a temporary 3 month (2 months now) position that ends in December.

I was going crazy trying to figure out a way to keep it but have gone through all savings and retirement. Sadly, all of us in this neighborhood who bought within the last 10 years paid approx 125,000 for their home and now they are next to worthless. Not worth keeping, even if I could find a full time job in the near future.

[CCsAreEvil]

Yeah, I went through the whole unemployment thing for about a year, too.

All those loans against the property should have been included in your BK filing. You can check your schedules to make sure they are listed. Also, once you are discharged, those lenders will/should be listed on that, too. You are no longer responsible for paying those at all.

Now, it sounds like you just are staying as long as possible in the property until they boot you. Good luck.

[iv65536]

To the OP: What notices have the lenders sent you on these loans? Have any sent you NOD? Have any served notice of a sheriff's sale? Have any sent you a mortgage counseling notice?

Also, have you filed, or do you plan to file, for BK?

[discouraged]

They sent NOD's. At least the 1st and 2nd. I haven't received notice of the Sheriff's sale - expect to this month. In MN you usually have 5 months until you receive it. And then 4 weeks until the sale.

Am planning on filing or at least finally giving the lawyer the money this week-end but now am so up in the air. Tobee posted that unemployment extensions will cease after November and now I am scared. This job only lasts until sometime in December, due to lack of funding for further time. I only have 179 left in my UI account and then I will only have the money I make this month and next if I give the lawyer 1800 plus the 299 filing.

I realize though that 2100 is a lot less than what I owe and I should be grateful. So will probably just close my eyes and jump in. Real scared about the future though. Would like to wait until after Nove 30 to make sure UI is closing the tiers. At the same time, I do not relish being sued. So up in the air right now as to what to do.

I'm