Possible Refinance or New Loan

Diasy1016

LoanSafe Member
Here is my scenario and I am in Southern California:

1st loan - modified in 2010 with current principal balance of $568,139.47 (as of 11/16/20); account is current with no late payments since modification

2nd loan - last payment made was January 2009; loan charged off approx. July 2009 and was discharged in Chapter 7 BK in Dec. 2010; balance at time of BK was $48,547 and was serviced by Ocwen at that time; loan has been transferred to other servicers since then and current servicer is Shellpoint Mortgage. There has been no collection efforts and loan will mature in June 2021.

The current value of the property is over $950K and we are looking into probably selling the property or perhaps refinancing. We have rebuilt our credit and it is in very good standing. The current liens showing on the property are the two loans mentioned above

Since the 2nd was discharged in a Ch7 BK, is there a possibility in trying to get the lien removed without a payoff and what grounds can we possibly present to the 2nd lienholder?
 

Jzone

LoanSafe Member
Here is my scenario and I am in Southern California:

1st loan - modified in 2010 with current principal balance of $568,139.47 (as of 11/16/20); account is current with no late payments since modification

2nd loan - last payment made was January 2009; loan charged off approx. July 2009 and was discharged in Chapter 7 BK in Dec. 2010; balance at time of BK was $48,547 and was serviced by Ocwen at that time; loan has been transferred to other servicers since then and current servicer is Shellpoint Mortgage. There has been no collection efforts and loan will mature in June 2021.

The current value of the property is over $950K and we are looking into probably selling the property or perhaps refinancing. We have rebuilt our credit and it is in very good standing. The current liens showing on the property are the two loans mentioned above

Since the 2nd was discharged in a Ch7 BK, is there a possibility in trying to get the lien removed without a payoff and what grounds can we possibly present to the 2nd lienholder?
Getting the lien removed without a payoff is unlikely. Check your state for property lien laws for time limits to enforce. There may be a statue of limitations for the lien holder to enforce a lien.
Since you want to sell or refinance, make sure you do not let the lien holder know about that. It will give them an advantage in any negotiations for a payoff and release. You may have to initiate contact with them because BK law limits any contact with debtor after bankruptcy.
You could call/write and simply state you would like to know what it would take to release the lien. Don't make an offer to settle but see what their first move is. Unfortunately, if you havent contacted them since BK, they probably will figure out the reason for contact is that you are selling/refinancing and will have little reason to settle.
 

Diasy1016

LoanSafe Member
Getting the lien removed without a payoff is unlikely. Check your state for property lien laws for time limits to enforce. There may be a statue of limitations for the lien holder to enforce a lien.
Since you want to sell or refinance, make sure you do not let the lien holder know about that. It will give them an advantage in any negotiations for a payoff and release. You may have to initiate contact with them because BK law limits any contact with debtor after bankruptcy.
You could call/write and simply state you would like to know what it would take to release the lien. Don't make an offer to settle but see what their first move is. Unfortunately, if you havent contacted them since BK, they probably will figure out the reason for contact is that you are selling/refinancing and will have little reason to settle.
 

Diasy1016

LoanSafe Member
Thank you for your input. Unfortunately, statute of limitations in CA for the lien is 10 years after maturity date and that is not in the near future since the loan matures next year. I did initiate an attempt to Shellpoint in writing to have lien removed with no mention of what my intentions are but have not heard from them. It's been a couple of months. I will try to call. Thank you again.
 

Erik Sandstrom

Mortgage Expert - Call 1-619-379-8999
Staff member
Loan Safe Mortgage
Hi there,
You're part of the infamous crowd of people with charged off 2nd liens. You can't remove the lien without satisfying them unfortunately. I am also here in southern California and would love to help, San Diego to be exact.

Some things to know:
2nd lien holder can't assess any additional late charges after the lien was charged off however every month the past due interest will accrue and the balance will continue to rise.

Cash out refinance is the only way to satisfy them without having the funds available - the max able to be borrower on your home is 80% of the value. If that doesn't cover the 1st and 2nd lien you may have to get to the drawing board, find out how much you can get to satisfy the lien and hope/pray they will accept your offer to settle.

If you want more information about this option, I'd be happy to help - 619-379-8999 or [email protected]

This is a very passionate subject of mine and have helped countless borrowers save their homes from these 2nd lien holders.
 

repatrison

LoanSafe Member
As far as I understand, these two scenarios have more possibilities if everything is well calculated. It makes sense to me because I'm used to analyzing all the documents and data that I have. I have tried many different calculators and turned to specialists in order to be successful in this business. For me, there was nothing more effective than help from https://www.remonttilainaa.com.
I managed to prove its effectiveness on my own experience, so I advise you to try it.
 

JohnFL

LoanSafe Member
Hey Erik, just a quick question. I thought the 2nd couldn't charge additional interest after the Statute of Limitations passed? If they can there are alot of screwed homeowners out there. Thanks, have a great weekend!!!
 
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