Foreclosure in 90056>Question Details

Curtis Thomp…, Home Owner in 90056

My first Mge. is 489K. My 2nd Mge. with Wells is 135K. The property is worth 500K. I stopped paying Wells. Will Wells likely fore.. I dnt think so.

Asked by Curtis Thompson, 90056 Fri Apr 1, 2011

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They mostly will not foreclose, however the 1st mortgage gets notified when you are late on all secondary or subsequent loans-the first mortgage will usually step in and buy the 2nd. However, remember the 2nd mortgage can still possibly come after you for payment through various ways and even possibly send you a 1099 for the write off of debt. I would highly recommend doing a short sale versus just letting the home foreclose. Also, I would like to suggest you seek the advice of a real estate attorney and possibly your account to find out what other implications will affect you in the future.

Much success to you,
Heather Paul, Realtor
Coldwell Banker
(310)586-0364 or (424)625-1037
0 votes Thank Flag Link Fri May 6, 2011
They most likely cannot foreclouse. However, you should consider if this is a recourse or non-recourse loan. If it is a recourse, they can in theory get a judgement and go after you for the balalnce.

Kobi Costa
Short Sale Specialist
DRE #01500254
818 921 5111
Web Reference:
0 votes Thank Flag Link Sat Apr 2, 2011
If the $135K was an equity loan or a cash out refinance, ultimately wells fargo will want a 30% payout in order to release the lien as Paid In Full & never come after you for a deficiency judgment. How this works is the 1st lien holder will pay 10%, the other 20% will be in the form of a cash contribution between you & the buyer for the short sale.

They won't let you just walk from paying nothing back on a equity loan where you received & spent $135K & whatever. Even if it went into upgrading the property. If say, we had an all cash buyer, you may get them to pay more than 10% as cash contribution, but they're going to want to see a cut in purchase price.

Your Indymac 1st, is a tough cookie, luckily you're not going to short them by that much. Your previous agent has only closed 3 short sales since Jan. 2009. You need to work with an agent with a bit more experience negotiating with Wells Fargo & Indymac on multiple short sales. How do I know this? I'm a good researcher. I also negotiate, successfully,, short sales for homes that are as much as 290mi. away from where I live.

Email or call me directly and I'd be happy to discuss this with you further.
562-430-3053 cell
Realtor Since 1996
Short Sale Expert
0 votes Thank Flag Link Sat Apr 2, 2011
If you call Wells Fargo, they may work something out with you.  This process will only delay the inevitable of Wells Fargo sending your loan to a collection agency.  Once this occurs, the agency will get a judgement against you at which time you can make arrangements to pay them back. 
If you decide to short sale, we have two real estate attorneys on our team who will represent you at no cost to you.  The attorneys will negotiate with Well Fargo and eliminate the deficiency judgement.  If you need more information, please call our office at 562-907-9900. 
Terry LaRoche
0 votes Thank Flag Link Sat Apr 2, 2011
Hi Curtis,

Typically, I have not seen the second foreclose on my clients, if they're not going to get any money. However, you would need to speak with an attorney to review your note, because very likely they can, if they want to.

If you're upside down on your mortgage and can't afford make the payments any longer, you can do a short sale. This will keep foreclosure off your credit. We are a professional short sale service and would be happy to explain the process to you. Please call us directly to discuss your specific situation. Our services are FREE to homeowners. We look forward to hearing from you.

Eli Givoni, Director
Short Sale Department, LLC
Serving all 50 states

MARS Disclosure for General Commercial Communications
Short Sale Department, LLC is not associated with the government, and our service is not approved by the government or your lender. Even if you accept this offer and use our service, your lender may not agree to change your loan. If you stop paying your mortgage, you could lose your home and damage your credit.
0 votes Thank Flag Link Sat Apr 2, 2011
Wells Fargo will run the numbers to determine whether a short-sale, loan mod, or foreclosure will yield them the most money; they'll go with the option that yields them the most money. If WF could get at least $313K for your property, then they'd probably opt to foreclose unless you do something about this.
0 votes Thank Flag Link Sat Apr 2, 2011
Emily is correct, Wells Fargo has become ruthless. The reason is, with the government bailout program, they make more money foreclosing on homes and doing short sales than they do modifying looans. And they WILL foreclose! Wells is buying up a lot of bad debt in the country, and not just mortgages in default, they are also buying student loans and credit card debt. They buy at a steep discount and then make a windfall when they collect as little as half of what is owed. But the mortgage business is particularly lucrative for them because of the bail out.

There are a few options you could consider. You don't say what your home is worth, but if it is less than you owe you could and should consider a short sale. You may be able to negotiate a pay off of the second mortgage at a discount. You may also want to consider bankruptcy. Talk to a good bankruptcy attorney, but you may be able to have the second mortgage changed to a position of unsecured debt and then have it discharged in bankruptcy.

The point is, you have many options and a good realtor/attorney team will always be your best source of advice. However, you must do something or you WILL lose your home.
0 votes Thank Flag Link Sat Apr 2, 2011
They will foreclose if you don't step in to do something about it. Wells is starting to send out Notice of Default letters quicker these days. It used to be that they'd wait about 4-5mos. Now you'll likely get the Notice of Default letter within 1-3mos.

Wells Fargo is not interested in doing loan modifications. I've had many clients who have good income who've been around the block & back Tryyyying to get Wells to give them a viable loan modification that actually makes sense for the long term.

Please consider taking advantage of the benefits of doing a short sale. The Mortgage Debt Forgiveness Act Expires at the end of 2012. This is where the IRS will NOT go after you & tax you on the negative amount. I can also get Wells Fargo to release their liens in FULL and waive any rights to a future deficiency judgment.

You CAN purchase a home again sooner than you may think after a short sale & build your equity back up from the bottom.

Please email me directly if you'd like to talk about this some more. I won't check back here on this same thread in Trulia for responses.
562-430-3053 cell
Realtor Since 1996
Short Sale Expert
0 votes Thank Flag Link Fri Apr 1, 2011
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