Very small 1st mortgage, huge 2nd mortgage. Need advice please!

[FishFun]

My home is in Florida.
1st mortgage is down to $10K and will be paid off in January.
2nd mortgage is a HELOC for $450K interest only 2.5%.
House is worth $360K.

Since I can't afford the payments any longer, I have rented it out. My question is...when the 1st gets paid off, will this affect how I might be able to negotiate on the HELOC? Should I stop paying on the HELOC now before the 1st is paid off? Both mortgages are with Wells Fargo. Any advice on how to handle this would be appreciated!

[Evan Bedard]

Since I can't afford the payments any longer, I have rented it out. My question is...when the 1st gets paid off, will this affect how I might be able to negotiate on the HELOC? Should I stop paying on the HELOC now before the 1st is paid off? Both mortgages are with Wells Fargo. Any advice on how to handle this would be appreciated!

Welcome and thanks for joining the community.

What exactly is it you are trying to accomplish on your 2nd mortgage?

[FishFun]

I'm underwater on the loans and probably will end up trying to sell the house in a short sale at the end of my tenant's lease. Truthfully, I really don't know what to do.

[Evan Bedard]

I'm underwater on the loans and probably will end up trying to sell the house in a short sale at the end of my tenant's lease. Truthfully, I really don't know what to do.

You really do not have to wait to pursue a short sale or other type of assistance before the tenant's lease is expired. Unfortunately there is probably not going to be too many options in this situation as a loan modification or refinance will not help lower your payments if your interest rate on the 2nd is already at 2.5%..