Home Buying in Bellevue>Question Details

Bellaniri, Home Buyer in Bellevue, WA

Why would a bank pull an account back from collections?

Asked by Bellaniri, Bellevue, WA Fri May 31, 2013

I have a second mortgage with BofA that was sent to a collections agency about a year ago. I've been making timely payment every month in effort to settle the account. I have about $25k left to pay of it. The collections agency was suppose to pull our payment this month on th 29th but it did not happen. I called the collections agency to find out what happened and they told me that the back pulled the account back. What does this mean & why would the bank do that?

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Answers

6
Is your first mortgage in good standing? If not and BofA received a pre-foreclosure notice they may have pulled it back in order to better manage the process.
0 votes Thank Flag Link Mon Jul 8, 2013
Is your first mortgage in good standing? If not and BofA received a pre-foreclosure notice they may have pulled it back in order to better manage the process.
0 votes Thank Flag Link Mon Jul 8, 2013
Have you found answers to your question from Bank of America? I would be very curious to know their response.

Since Bank of America settled a Federal lawsuit some time ago (sorry, I forget the exact time frame) they were (are) required to settle on a large number of underwater second mortgage. I personally know several people who received letter from BofA canceling the second mortgage all together.

Admittedly, I have not heard of any loans being pulled back from a collection agency. It actually does not make sense, since collection accounts are usually "sold", so taking them back would not seem plausible. Unless, of course, the collection agency is a subsidiary of Bank of America.

Hope you will post your resolution, as it could help others understand the current (and ever changing) situation with second mortgages.

Deborah
NMLS @279125
0 votes Thank Flag Link Mon Jul 8, 2013
Hi Bellaniri,

It is hard to make any guess without knowing all the facts. I recommend you call Bank of America and ask them. Escalate your question until someone can give you an answer. Personally, as a very general statement, I feel you are better off working through your debt with the bank than the collections agency.

Good luck,
Karen
0 votes Thank Flag Link Fri May 31, 2013
Bellaniri,
Have you asked BoA? There are several possibilities, and getting out of collections is a good thing. They may have modified your second, written it off, forgiven it or just put you in good standing.
Congratulations, I suspect it's a good thing.
0 votes Thank Flag Link Fri May 31, 2013
There could be many reasons they pulled it back. Is your house underwater? BofA might have decided that there is enough equity in the home now so the second mortgage becomes secured instead of unsecured if there is no equity. If your house has equity, the 2nd mortgage is more valuable so they probably want to keep it.
0 votes Thank Flag Link Fri May 31, 2013
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