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Is there a statue of limitation on a 2nd mortgage if the lender has charged it off.

Perris, CA |

I have a first and second on my primary home. The bank that owned them went out of business and it transferred to another bank. Now I was in full foreclosure at the time of the bank closing it doors. i was able to modify and save my home but they only modified the first loan. The second went to the new bank then was handed over to another back which in turn handed it over to the 4th bank. They just trying to collect now. I have not made a payment since July of 2009 on this second loan. What are my options to get rid of it or well the statue of limitations stand on this. Plus once it left the org bank the title never changed hands its still showing the old bank as the holder. When they modified my loan the 2nd showed paid off and not active this is why it was not modified

Attorney Answers 3

Posted

Unfortunately on the facts you have given, the second deed of trust would still be of record and a valid lien against the property. That will prevent you from selling or refinancing the property unless you come to terms with the holder of the second trust deed note. You do not indicate whether the property is worth more or less that the balance of the two loans. You also do not provide any information regarding the terms of either loan. You should seek the advice of a real estate attorney in your area to assist you in evaluating the situation.

This answer does not constitue legal advice, nor does it creat an attorney/client relationship. If you are seeking legal advice upon which you intend to rely, you should hire competent cousel familiar with this area of the law in your locale.

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Posted

Agree with other counsel, the lien is still good, charge off or lender going out of business doesn't make it go away. You have some options here 1) settle for a lesser amount to remove them from the lien 2) arrange payments 3) this one depends on some more facts: if the value of the property is below the balance on your first mortgage and this is your primary residence you can strip the second mortgage through chapter 13. Whether this is a good option for you will depend on more information. You'll want to consult with a bankruptcy experienced in handling chapter 13s. Ask them how many they've done and how many of those have been successfully confirmed.

Hope this helps and Good luck to you.

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Asker

Posted

First Yes this is my primary home. I owe 360 thousand and house is worth 170 thousand maybe. We are in a hard hit area of calif that equity just dropped terrible. Second my problem is that Bank of America acquired the loan and then service released it to another bank. I just went down an event that Bank of America had and they did a huge search on this loan they said we do not own it and we cant do anything to help you. When i call the other bank they tell me we are servicing it for B of A and we do not own it either. So I am confused because nobody claims to own the loan and one is claiming to be a debt collector for the loan. I did file chapter 13 but the case was dismissed out of court. The attorney we used was tainted and well he has been disbarred. So I am waiting on my money to come back from the state bar to re file. Anther thing is loan is not on my credit report. I went to the county recorder and the loan stops with The first bank that originally owned it. You mentioned come to terms with the holder of the loan. I am not sure who the holder of this loan is. Nobody wants to admit they own this loan. I am guessing my only thing to do would be is do a chapter 13 and strip the second. This was an 80/20 loan. Thank you Leslie

Posted

If you have some cash on you, you can try to negotiate a settlement with your second mortgage lender. See if the lender will accept less than what you owe as a settlement of the debt in full, but be prepared to pay a lump sum should the bank ask for it. Also, if the value of your home is less than what you owe on your first mortgage, you can look into a Chapter 13 bankruptcy. A Chapter 13 bankruptcy allows you to "strip" the lien of the second mortgage lender. Essentially, after you're done with going through Chapter 13, the second mortgage lender will no longer have a lien against your home. To learn more about this, you need to consult a bankruptcy attorney who wil be able to review your situation and explain to you how Chapter 13 works.

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Asker

Posted

That's what I am working on doing I think, is filing a chapter 13. But my problem is there is really no holder of the loan. B of A said they released it to Carrington and they say we do not own it and they gave it to Compass bank. And Compass tells me they are only servicing it for B of A. I went to an Event this last week with B of A and they told me they have nothing to do with the second but they have my first. And originally my First and Second was with First Franklin who is not out of business but before they closed their doors they turned both my first and second over to B of A. Also my second originally was 85 thousand and later modified by First Franklin who didn't do anything really to the loan but they put 35 thousand up front and then 50 on the back of the loan and I have received many letters from Compass that ask me for 35 and 98 and I am not sure how they are reading the loan. I know they are not going to foreclose at this point because I am right at 200 thousand under water with my home. But the last time this loan was paid on was the first months of 2009 and it was charged off. And it didn't change hands till OCT of 2010. I checked the county recorders office more then once and my first shows it was transferred to B of A but my second was not it stops there with no more transfers. I though it was the law in the state of calif who ever owns the loan has to record it? I have called and did it in witting asking for them to show proof they own the loan and this is where my head ache begins they all tell me we do not own it we are just servicing it. I am looking into filing a chapter 13 which I already did file over a year ago but this attorney we had was so horrible, he took a lot of people including us and all his cases where thrown out of court. So it was dismissed with the option to re file but its not that cheap of an ordeal So I am waiting for the state bar security fund to give my money back that we lost. This attorney was disbarred as of June of this year so I am looking at maybe anther 6 months or longer before I see my money back. Thank you for all your advice its made a lot of sense to me. Leslie

Ekaterina Berman

Ekaterina Berman

Posted

My boss, who was a financial planner at one point, always told me that you will unlikely find out who owns your loan. Someone out there probably owns it, and I don't think that it really matters who. You will be dealing with the loan servicer because whoever owns your loan does not want to deal with it. If you decide to go for Chapter 13, make sure you find the right attorney. Don't go for paralegals or people who offer to do bankruptcy starting at $99. You get what you pay for, so be very very careful when choosing someone to work with.

Asker

Posted

Thank you. Yes I well be very careful who I chose. I have learned my lesson. I hired an attorney in Orange county calif. He filed a chapter 13 for us in 2010. He never followed through with anything. And in the end we had to do a voluntary dismissal. I have bought everything back and its all good except this form that fiasco. But This attorney ended up loosing his license and being disbarred. But many lost their homes because of him. You are right nobody wants to own up to owning this loan. Right now I am in hopes to get my money back from the state bar and then I can go ahead and file a chapter 13 again and do a lien strip. Right now we are way underwater with our home and I do not want equity to go up, because then I might have a problem of lien stripping. Thank you for all your advice. Leslie

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