Home Buying in Sacramento>Question Details

renelanda45, Home Buyer in Sacramento, CA

ok soo i lost my home in 2008 and the second loan still shows in my credit what do i do to get it off i want to try to buy another home in california

Asked by renelanda45, Sacramento, CA Thu Jul 26, 2012

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My daughter purchase a home with a first and also a home equity line to help cover the price of the purchase. This was the lenders (Chase ) idea. When the market failed and she could not keep the house she did a short sale. She did not understand the second loan was not included until three and a half years later when she tried to buy a home. They would ignore the short sale but not the forclosure on the second. They will not remove the forclosure from her credit and say they may try to collect some day. I'm trying to sell her a house at 50% of value and they still will not lend to her with the forclosure on her credit. What can we do.
Bill
0 votes Thank Flag Link Sun Jul 6, 2014
You might want to pose your question to a real estate lawyer for free at http://www.lawguru.com
You also might want to add some details as to whether you lost the home in foreclosure or short sale.
Best of luck
0 votes Thank Flag Link Thu Aug 2, 2012
If the second loan was not purchase money (i.e., you got the loan when you originally purchased the house), you would still owe on the loan even after a foreclosure by the first lender. Only the security interest is wiped out after a foreclosure, but the personal obligation is not wiped out. I would definitely recommend you speak to an attorney about this. It's an interesting situation because the loan does not disappear after the foreclosure, but the lender may be barred from trying to collect if too much time has passed since you made your last payment (i.e., statute of limitations may have run). An attorney can advise you. Your situation is an example why home owners are better off with a short sale than a foreclosure.
0 votes Thank Flag Link Thu Jul 26, 2012
Ute Ferdig -…, Real Estate Pro in Newcastle, CA
MVP'08
Contact
Second showing as a charge off with foreclosure is okay.
If this was an FHA loan your three years start from the day that HUD paid off the claim.
If this was conventional, you are good to go.
0 votes Thank Flag Link Thu Jul 26, 2012
Talk to Steve Beede's office- BPE Law Firm, as mentioned below.

Pull your original loan file and bring it with you. Whether this loan was a purchase money loan, or a cash out/re-fi loan where the monies were used for things other than the house will make a difference.

They charge $200 for a one hour consultation that will explain all of that. If it turns out that you are still owing on that debt then you may want to talk to a bankruptcy attorney to see if that is an option to consider to wipe off that debt. Scott CoBen is excellent and provides a free one hour consultation.

Last, i hope you're working with a good accountant. The CA and Federal Tax Relief act expires at the end of this year. No one is banking on it being extended so you may have some tax implications to consider as well. Ed Cook at (916) 705-4958 is an excellent resource....but talk to the attorneys first.
0 votes Thank Flag Link Thu Jul 26, 2012
How did you lose your home, short sale or foreclosure? If it was a foreclosure, in California, the secomd should have been wiped out.

Check with an attorney, or legal aid to see what you can do to get it off your record. If it was a foreclosure it will probably take some documentation, many letters and phone calls, and a good deal of patience and perseverance.

Good Luck
0 votes Thank Flag Link Thu Jul 26, 2012
Hi - Did you file a Chapter 7 or just let your home go into foreclosure? If you filed bankruptcy the both mortgages were forgiven but if you did not then you need to contact an attorney. An attorney should be able to advise you in this matter. Good Luck.

Cindy Schlee, Realtor
Grand Rapids, Michigan
616-558-9595
cindyschlee@grar.com
http://www.cindyschlee.com
0 votes Thank Flag Link Thu Jul 26, 2012
I concur with all of the responses below. If you lost the home to foreclosure, typically the second gets wipped out. But if it's still there, without knowing specifics about your situation, we have no way of advising you except to say contact an attorney who specializes in this area.

A great one would be Steve Beede or an associate attorney at the BPE Law Group:

BPE Law Group, Inc.
Main: 11140 Fair Oaks Blvd., Suite 300, Fair Oaks, CA 95628
Satellite: 9245 Laguna Springs Dr., Suite 200, Elk Grove, CA 95758 (Appointment Only)
(916) 966-2260

Hope that helps

Keisha Mathews, REALTOR®
CDPE®, HRC®, HAFA® Certified
The Short Sale Lady(sm)
Century 21 Landmark Network
(916) 370-1803 cell/direct
(916) 405-3886 fax
keisha.mathews@century21.com
http://www.SheSoldItForMe.com
lic#: 01439130
0 votes Thank Flag Link Thu Jul 26, 2012
Hi,
Wellllll...if you still owe on your second loan, it's gonna be hard to get it off your credit without paying the loan off!

If your home foreclosed, and the second lien holder is claiming you still owe them the amount ot the loan, you should consult a real estate attorney and find out your responsibilities or solutions to this problem.

You can also write a letter to each of the three credit reporting agencies and challenge the information on your report--to have it removed--if you believe the information being reported is incorrect.
0 votes Thank Flag Link Thu Jul 26, 2012
How did you lose your home? Did it go through foreclosure? The loan will stay on your credit report. It doesn't vanish. But you should be able to qualify to buy another home, depending on your FICO.

Elizabeth Weintraub
Broker-Associate #00697006
Lyon Real Estate
0 votes Thank Flag Link Thu Jul 26, 2012
Rene: If that second loan was not utilized for purchase money (you took it out to pay off debt, etc) that loan may have foreclosed but the lender may still have recourse on it.
Call that loan servicer and ask them why it still shows as a balance (?) on your credit report. It may be a clerical error (imagine that!).
Also, you may want to check with an attorney on this, as well.
In order to remove from credit, that lender has to report it as a zero balance...
0 votes Thank Flag Link Thu Jul 26, 2012
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