Need advice - Second Loan paid by insurance to SunTrust 12 years ago, now insurance want to collect debt plus interest

[Lenin]

Hello folks,
I have a situation, part of a loan modification process, my second loan was paid off by mortgage insurance to SunTrust 12 years ago, now insurance want to collect debt plus interest. There is a lien on my properly which is not going to go away as explained to me by the insurance company that paid off the debt about 12 years ago.
I was not aware of any of this until now that I want to refinance my first loan. My question is does the insurance company have the right to collect the high interest rate originally set on the loan which actually doubles the loan.
The insurance company does not want to negotiate because the property does have enough.
I am in CA and it and the lien has been there for 12 years .
Any advice would be greatly appreciated.

thanks

 

[Survivor_IN]

I would get a real estate attorney involved to assist you in the refinance and related closing. This involves a title search and they would be most familiar with that process. Don't expect the insurance folks to be forthcoming on your rights or the true amount of the debt. There is more involved here than meets the eye. They may or may not have rights to the original mortgage and note. Also, notes typically only cover 150 percent of original debt. You can always make them "prove" the amount of the debt and show the note.

 

[Lenin]

I would get a real estate attorney involved to assist you in the refinance and related closing. This involves a title search and they would be most familiar with that process. Don't expect the insurance folks to be forthcoming on your rights or the true amount of the debt. There is more involved here than meets the eye. They may or may not have rights to the original mortgage and note. Also, notes typically only cover 150 percent of original debt. You can always make them "prove" the amount of the debt and show the note.

Thank you very much for the valuable information, I will definitely follow the advice.