Oregon Walk Away- Need help!

[Salblock]

Hello Everyone!

So I need some help and some guideance.

Here's our story.

Purchased house in Oregon City, OR 97045 in Dec 2007.

House was purchased for $207,00
1st Mortgage was with WELLS FARGO HOME $172,000 @ 6.5% Intrest Only for 10 years
2nd HELOC was CHASE $35,000 @ 9.0%
Both original loans were all purchase money.

Refi'd the 1st Mortgage with Wells Fargo 3 step process in Dec of 2011 at 4.5% fixed rate 30yr with Wells Fargo.

1st missed payment was March 1st 2012 on both loans.

We've put $20,000 into the home with renovations and improvements. Home is now worth around 100-110k if we're lucky. On top of what we've done to the house, it needs a new roof, has a crack in foundation (basement leaks/floods) and a new landscaping job. To add we've had a baby (wife and I) and we have another on the way, so we are out growing the house quickly.

We cannot afford to throw money into something we cannot live with long term.

If this was a business, we'd walk away from it also.

Wells Fargo has been calling from day 17 or so. About a month ago, I sent them the cease letter. They still called, so I reminded them of the letter. They apologized, and said it wouldn't happen again. Well, it happened again today.

We received a couple letters asking for contact from Wells Fargo. We've also received 2 packets requesting information for loan assistance etc.

On July 5th, I recieved a letter stating that the foreclosure proceedings are have begun and they gave the firms information on who is handling the process. That firm then sent me and my wife seperate letters stating the process is started.


We'd like to delay this foreclosure as long as possible.

What are the options we have available?

Also, since the loan was refi'd, can we be sued? I've read that Oregon doesn't allow recourse loans even on refi loans. Is that true?


Also, my wife lost her job due to a over staffed lay off, and she's pregnant due in September 2012.

Can anyone help?

[Cat Damiano]

Hi Salblock,



IF you are receiving the loan modification packages, then you should be able to stave off the foreclosure by filling it out and getting into the modification process. There are many members here who are doing just that by making a game of it with many creative ideas here, post number five on page one in particular;

http://www.loansafe.org/forum/chase-...heel-game.html

Also Oregon just recently passed a mediation bill whereby the lender would have to conduct mediation to try to work something out versus foreclose;

http://www.leg.state.or.us/12reg/mea.../sb1552.en.pdf

Your questions in regards to the recourse of a loan in Oregon or deficiency judgements would need to be answered by a real estate foreclosure attorney in your area.

[Michael Shurtleff]

I agree. Talk to a local hud housing counselor. play the modification game. have fun with it. You will not be able take advantage of the mediation program because it only applies to nonjudicial and all wells foreclosures will be judicial for the foreseeable future (I should qualify that - if MERS is listed as the beneficiary on your trust deed it will be judicial, if not it will probably be nonjudicial). You may want to answer the judicial complaint. Not much chance of having to pay their attorney fees because you are just defending which is a different situation than bringing a proactive suit to challenge a nonjudicial process. If you answer you will probably get yourself on more of a back burner. Best to have an attorney file your answer but even a small dispute in the amount owed justifies an answer. Then they have to at least go to the point of motion for summary judgment to get the thing killed. Filing an answer would cost very little if the attorney understood your goals. If you have any real defenses then you could get some negotiation through the foreclosure attorney once you file an answer and have a better conduit for negotiation than working with loss mitigation. There are all kinds of possibilities.

As for the deficiency. In Oregon the rule is if it is a nonjudicial then there is no way they can get a deficiency...period. If it is a judicial foreclosure and you didn't abandon the property before your first default then unless it is a true 80/20. two loans made at same time from same lender then the "nonforeclosing loan" can get a deficiency. Your non foreclosing loan - in this case the second - can get a deficiency both because it was not a true 80/20 and because you refi'd the first so even if it had been an 80/20 the loan being foreclosed and the one not being foreclosed would not now be taken at the same time from the same lender because the wells loan was refi'd. Chase may be very likely to seek deficiency. Bankruptcy is always a possibility at that point to discharge that judgment. All of the above deficiency stuff is found in ORS 86.770. you have to do some serious puzzling to see how the refi and heloc and 80/20 situations play out based on the statutory language.