What are the chances my home goes into foreclosure?

Asked by mleicheal, Sacramento, CA Tue Feb 5, 2013

I am up to date on my first mortgage but just received a letter stating I defaulted on my home equity line. The home is worth about 230k and I owe about 180k on the first mortgage and 150k on my home equity line. Will I go into foreclosure even though I am current on my first mortgage?

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Doug Grace, Agent, Sacramento, CA
Tue Sep 30, 2014
If you received a Notice of Default, you can be certain the bank has started the foreclosure process. You are in foreclosure. If you do nothing, the bank will sell your house at auction. I've been working with people in foreclosure for over 15 years, helping them avoid foreclosure. I see foreclosure sales happen every day because people didn't take action.

You need an expert on your side, who has dealt with banks and foreclosures. Take action sooner rather than later!
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James Tan, Agent, elk grove, CA
Thu Feb 14, 2013
I agree with all my esteemed colleagues, since there is still equity left in your heloc, the heloc lender may decide to foreclose if you continue to default.

You should try to get a loan modification. Alternatively, once the heloc goes into "charge off', you can try to settle. Provided of course, you have a significant amount of cash to settle with them. Since there is only about $50k equity left, you may be able to get a reasonable settlement. Make sure you keep your lines of communication open with your heloc lender. Don't lose your home.
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Jeff Marr, Mortgage Broker Or Lender, Roseville, CA
Sun Feb 10, 2013
mleicheal - the 2nd lienholder has the same rights as the 1st lienholder in this regard....

Contact that bank and make arrangements to get caught up now!

The market has finally started to heat up, equity is rising, you don't want to risk losing your home now if you've hung on for a long time!

Good luck to you, Jeff M
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Frank Verni, Agent, Sacramento, CA
Wed Feb 6, 2013
Its important that you speak to your 2nd lender and try to work something out. If they did foreclose then they would be responsible to pay your 1st mortgage .... They really don't want to own your home but they will probably take action especially since they would receive approximately 50K. You should absolutely call them and let them know you situation. I also recommend that you seek legal advise and call Steve Beede, whose contact info was given to you below.

Good Luck!
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Cindy Davis, Agent, San Diego, CA
Wed Feb 6, 2013
Yes, if your default on your second, they can and will foreclose. All loans on your home must me paid! As others have suggested, try to work something out with them....

Good luck.
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Hena Martin, Agent, Hot Springs, CA
Wed Feb 6, 2013
Call you 2nd mortgage and talk to them ,let them know your situation and see if they are able to modify that for you ,or please call me ,If I may assist you .HENA MARTIN BROKER
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Keisha Mathe…, Agent, Elk Grove, CA
Wed Feb 6, 2013
As Michael and Walter have stated, your second can move to foreclose and will move to foreclose to protect themselves. You should seek legal counsel regarding your specific situation and try to work something out with the second, or work out a new plan with the first to give you some cash reserves to clear up the amount owed on the second.

The timeframe on foreclosing can take anywhere from 90 days (once you've defaulted) up to a year (on average) depending on how quickly the lienholder decides to work, as well as state law which may mandate more time where applicable. Since I am not an attorney, nor do I know the details of your default, I cannot tell you exactly how much time you might have. It is NEVER a guarantee that they will take longer. Always assume the wrost case in situations like this, which would be 90 days from the default.

Have you tried http://www.KeepYourHomeCalifornia.com? As it pertains to modifying your second, you may be eligible for an alternative program evaluation with more flexible debt-to-income criteria.

Regarding legal advice, I recommend:

Steve Beede, Founder and Managing Partner
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

I am assuming you want to keep your home. If modifying either loan is not an option and you are forced to sell, please contact me. At that point, you may be eligible for a short sale and state law may protect you from any recourse from either lender once the short sale closes. In addition, you may also qualify for a seller relocation fee for cooperating with the short sale.

My contact information is below. Hope this helps. Please keep me posted.

Keisha Mathews, REALTOR®
CDPE®, HRC®, HAFA® Certified
"The Short Sale Lady"
Century 21 Landmark Network
(916) 370-1803 cell/direct
(916) 405-3886 fax
keisha.mathews@century21.com http://www.SheSoldItForMe.com
lic#: 01439130
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Walter 'Skip'…, Agent, Brea, CA
Wed Feb 6, 2013
The fact that there is $50,000 in value over what is owed the first, that might be enough financial incentive for the second to foreclose. Be careful.
Good luck,
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Michael Cheng, Agent, San Jose, CA
Wed Feb 6, 2013
It's hard to tell whether you'll eventually go into foreclosure. That's the same challenge faced by the lenders when issuing credit to purchase a home. At this point, if you're current on the first mortgage, then there likely won't be any foreclosure proceedings. But, long-run, if you continue to default on the equity line and the line is from the same lender as your first mortgage, you may eventually be foreclosed upon.
Web Reference:  http://www.archershomes.com
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