I hope someone can enlighten me with this. We live in California and purchased a home in 2006 with an 80/20 loan - 1st loan is with ING (435k) and 2nd (118k) is with Wells Fargo (HELOC). If we never refinanced, does the 2nd loan considered 'purchase' money?
I was working with ING for a loan mod. and had stopped paying my mortgage (both 1st & 2nd) for 8 mos. Then a month ago, I found out through my credit report that my 2nd loan was charged off by Wells. Next came the letter from the Collection Agency (Primary Financial Svcs. based in AZ.)... My 2nd loan was 118k and the collector wants me to pay 47k and was only given a few days to come up with the money (like I can just pick 47k from my trees in the backyard!)..Anyway, we called them and was trying to settle the debt for 6k as this was the maximum amount we can borrow from our relatives and friends. The collection Agency declined it and insisted we should pay 47k. What happens if we can't pay it? Will they foreclose our home although the loan mod. for the 1st has been completed? - will they garnish our wages? file judgement deficiency? I am worried, please help!