2nd mortgage charged off by original creditor/can debt collector foreclose

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Hi Cookiemom,
It's very difficult to tell you what actually happened without reviewing the loan modification documents. Loan modifications usually entailed interest rate reductions, term extensions or even principal forbearance or forgiveness. When you apply for a modification they used to tell you "Miss 3 payments and call us back" - essentially saying they won't help you without the loan being delinquent. Those payments that you missed as well as any fees associated with that occurring could have been tacked onto your balance or put at the end of the term of the loan. This was very common practice during those days to do one of those actions.

The 2nd lien shouldn't have anything to do with the 1st lien even if it is serviced (or even the investor) by the same entity.

Regarding the 2nd and the balance increasing by the interest from the missed payments, you can usually request something from the servicer of that lien that would show amounts accrued from that. Personally I haven't requested anything of this nature but I'm almost positive it can be provided along with a ledger of fee's assessed (if any).

If you have any other questions please don't hesitate to reach out. I hope this answers your questions.
 

cookiemom

LoanSafe Member
Hi Cookiemom,
It's very difficult to tell you what actually happened without reviewing the loan modification documents. Loan modifications usually entailed interest rate reductions, term extensions or even principal forbearance or forgiveness. When you apply for a modification they used to tell you "Miss 3 payments and call us back" - essentially saying they won't help you without the loan being delinquent. Those payments that you missed as well as any fees associated with that occurring could have been tacked onto your balance or put at the end of the term of the loan. This was very common practice during those days to do one of those actions.

The 2nd lien shouldn't have anything to do with the 1st lien even if it is serviced (or even the investor) by the same entity.

Regarding the 2nd and the balance increasing by the interest from the missed payments, you can usually request something from the servicer of that lien that would show amounts accrued from that. Personally I haven't requested anything of this nature but I'm almost positive it can be provided along with a ledger of fee's assessed (if any).

If you have any other questions please don't hesitate to reach out. I hope this answers your questions.
Thanks! I actually have requested a payment history QWR and it's complete garbage...shows nothing other than the original loan amount and a few late fees. Nothing itemized to show historical accrued.
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
From what I’ve seen they use the same amortization schedule from the original loan. Who currently services your liens?
 

Survivor_IN

LoanSafe Member
Eric, on a purchase loan "product," the second is always 20 percent value to meet the down payment. I can't say what happens on a HELOC style second. Mine was 10 or 15 year loan, not amortizing the same way the predatory first but at very high interest rate. Just an FYI, the second lien program WAS in effect in 2010. Lenders simply passed it over declaring they had to complete the first, first. Given all the misinterpretations, highly possible unscrupulous lenders took advantage. They knew that properties were underwater and that the second lien could be wiped out in exchange for government payments of a certain percentage. They also knew that after modification, both first and second payments together, existing "as is, " were not affordable. No one sued because it was super difficult to get lender compliance on the first loan modification. So now... we have a lot of seconds... hanging. Good luck getting accurate information and records for a refinance. These delays cause even more interest to accrue.
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Hi Survivor, I don't necessarily need amortization schedules, QWR's or anything of that nature to complete a refinance. There is however special documentation that I do have to obtain that many other lenders have problems getting which ultimately result in a denial when I've figured out how to circumvent the issue. I guess you can call it my niche that I've worked so hard to ensure a smooth process on because I care so much about these situations.

What you're mentioning regarding the 2nd and their practices is actually something that I mention myself but have no way of proving that these lien holders did actually receive bailout funds whether it be from TARP or other. Have you dug deep into that and know for a fact they were paid based on these non performing notes or is it just speculation?
 

Survivor_IN

LoanSafe Member
Have you dug deep into that and know for a fact they were paid based on these non performing notes or is it just speculation?
I'm finding that these records can be altered or revised and the servicing accountings don't accurately reflect events, in particular with government reporting of HAMP. Leaves the door open to make multiple (even contradictory) claims to multiple parties. Just a word of caution. One would think an amortization schedule is easy enough? but you are not going to get that if it means admitting certain actions and adjustments were taken that were deceptive
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
I apologize but I'm having a really hard time deciphering what you're trying to say. My knowledge lies with the hundreds of homeowners I've refinanced in this situation that I've seen almost get foreclosed on. When it comes to litigation, contradictory claims I haven't seen that personally. The head counsel that I work with over at RTR for example is more than willing to provide whatever is needed to validate the debt whether it be through a QWR or breakdown of interest accrued from the point of not paying. Of course I know that the regular person answering the phones over there you may have a bit more challenging time getting anything out of them.

We also talk to on average about 50-100 people a week in this situation and most are either planning to sell their home (or have already listed) or believe they don't owe the 2nd lien holder anything/wont give them a dime. Those same people usually call us back when they get a NOD or NOS on their door when they could have been a bit more proactive and taken care of it sooner.

Ultimately there's different ways to fight these battles, but what is actually effective. Has anyone been able to successfully get them to forgive these liens? If I'm not mistaken awhile ago BigFrog said that he was able to do that but never provided any proof of it.
 

cookiemom

LoanSafe Member
I apologize but I'm having a really hard time deciphering what you're trying to say. My knowledge lies with the hundreds of homeowners I've refinanced in this situation that I've seen almost get foreclosed on. When it comes to litigation, contradictory claims I haven't seen that personally. The head counsel that I work with over at RTR for example is more than willing to provide whatever is needed to validate the debt whether it be through a QWR or breakdown of interest accrued from the point of not paying. Of course I know that the regular person answering the phones over there you may have a bit more challenging time getting anything out of them.

We also talk to on average about 50-100 people a week in this situation and most are either planning to sell their home (or have already listed) or believe they don't owe the 2nd lien holder anything/wont give them a dime. Those same people usually call us back when they get a NOD or NOS on their door when they could have been a bit more proactive and taken care of it sooner.

Ultimately there's different ways to fight these battles, but what is actually effective. Has anyone been able to successfully get them to forgive these liens? If I'm not mistaken awhile ago BigFrog said that he was able to do that but never provided any proof of it.
More the reason to validate the debt, get them to show the amortization of how they are arriving at the final amount due. I'm not just going to say ok.. here's the $. Show me the books. If they received the TARP bailout it should show a credit on there. If this was an official exchange, they should ALL records not just since their servicing date to current. These have also been included in PSA and some of their actions could be a violation or deem non-transferable.
 

Survivor_IN

LoanSafe Member
More the reason to validate the debt, get them to show the amortization of how they are arriving at the final amount due. I'm not just going to say ok..
This may appear more viable in litigation. (or not, it's is a bone of contention for some) I'm trying to express that lender's calculations should be verified as a course of conduct and to scrutinize payoff requests for refinance. Maybe they share such information freely with non-litigant parties and outside of the courthouse? I just find it a red flag that my particular lender is saying an amortization schedule does not exist. How else can I verify an accounting method or balance?
 

cookiemom

LoanSafe Member
The schedule does not exist because the is no debt to record after this has passed along and buried in PSA, Fintech. These servicers are acting under which the bookrunner investment bank coerces either payment or property.


Those certificates did not transfer any financial or legal interest in your underlying obligation, legal debt, note or mortgage to anyone. The assignment is therefore most likely completely bogus having been fabricated strictly for the purpose of enforcement, containing false information (sale of the underlying obligation) and forged by robosignors.

The investor is not managing the affairs of any trust that owns any right to administer, collect or enforce an obligation from you. Therefore any company claiming authority from someone such as BNY Mellon is citing to authority that does not exist. Otherwise clean records should be kept and provided upon request.
 
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