Strategic Default on my 2nd - here goes nothing!

TomEason

LoanSafe Guide
murgurl

Thanks for your post.

Since you really have both a 2nd and a 3rd with Citi, it would behoove you to determine for sure which loan the NOD was filed for, and which is a 2nd and which is a 3rd.

If the $70K loan is a 2nd, it's not underwater. Perhaps that's the one Citi is FCing on. However, it is mystifying because Citi would wipe out their own 3rd which would become a recourse SOJL. They might be planning to sue you on that recourse loan after the FC by the 2nd.

However, this is all supposition on my part. You might order an abstract of title on your property from a local title company to help sort this out.

If in fact my supposition is correct, your Citi $70K 2nd is in the money. If that's the case, Citi has the leverage in negotiations and you'll need to be more compliant in your negotiation strategy with them.

You might visit this thread for more info. http://www.loansafe.org/forum/debt-settlement/41196-settling-money-2nds.html
 
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meggood

LoanSafe Member
The NOD is worrisome. Normally banks don't file those (did you make sure it was really filed?) unless they are serious. Of course, they could be serious on erroneous info if in fact your home value isn't 370K.

Can you re-submit a mod application? now that you are 5+ mos behind, your application might look more serious.

Remember that they also know that if they FC, they will recoup AT BEST only 120k on your 210K second. So you still have that card. remind them of it!! That is, unless Tom's scenerio of the 2nd FC'ing and the 3rd then suing you, since it's recourse. But as he and others have noted, it is extraordinarily rare, if EVER, the case that a SOJL will sue.

good luck!
 

moscow

LoanSafe Member
Update from me:

Chase cancelled the second mortgage (90K) as a result of the national mortgage settlement.

My housing crisis is over!
 

cityjake

LoanSafe Member
Hello TomEason,

Would like to get your opinion on a related matter,

Have a 6 month old FHA appraisal on my home for 150K, first mortgage with BOA 70K balance $751payment @ 2% 9 years to go, have a second for 144K at 11.5%, 20 years to go with greentree (originally with irwin home equity in 2007), just came out of a temporary 3 year mod where my payment went from 921 back to 1645. Got 50K in total CC debt (1030$ month) and the house of cards is about to tumble. Taxes and ins. on the side at $350 month. Credit is golden for both wife and I but its on its way out as I type.

Greentree refused our second attempt at mod citing not enough income. Have put some serious though into using the settling strategy you have highlighted. Would like your opinion on what you think Greentree liklyhood of settling as opposed to forclosing as we go behind. Had expected that foreclosure costs to the bank which I have learned average is 78K nationwide would make it likely they would since it would chew up a big chunk of the 80K equity greentree has in the home. Was just advised tonight (independant third party co on this site) that their foreclosure cost may be signifcantly less and foreclosure may be a better option for them. Was hoping you may have some insight on this scenario.

I read about the first 10 and last 10 of the 92 pages on settling seconds and wanted to see if you would be so kind to advise an opinion.
 

TomEason

LoanSafe Guide
Hello TomEason, Would like to get your opinion on a related matter, Have a 6 month old FHA appraisal on my home for 150K, first mortgage with BOA 70K balance $751payment @ 2% 9 years to go, have a second for 144K at 11.5%, 20 years to go with greentree (originally with irwin home equity in 2007), just came out of a temporary 3 year mod where my payment went from 921 back to 1645. Got 50K in total CC debt (1030$ month) and the house of cards is about to tumble. Taxes and ins. on the side at $350 month. Credit is golden for both wife and I but its on its way out as I type. Greentree refused our second attempt at mod citing not enough income. Have put some serious though into using the settling strategy you have highlighted. Would like your opinion on what you think Greentree liklyhood of settling as opposed to forclosing as we go behind. Had expected that foreclosure costs to the bank which I have learned average is 78K nationwide would make it likely they would since it would chew up a big chunk of the 80K equity greentree has in the home. Was just advised tonight (independant third party co on this site) that their foreclosure cost may be signifcantly less and foreclosure may be a better option for them. Was hoping you may have some insight on this scenario. I read about the first 10 and last 10 of the 92 pages on settling seconds and wanted to see if you would be so kind to advise an opinion.
Thanks for your post. Your GT 2nd is underwater, and GT won't FC. I recommend you seek to eventually settle (there's no rush) by following the guide at post #1 in the following thread. http://www.loansafe.org/forum/debt-settlement/37996-strategy-settling-your-2nd-94.html
 

HighlanderDP95

LoanSafe Member
Wow, over three years have passed and nothing has changed. Other than the offer to settle for 50% after the first couple of months, I have received no communication from Citi or its assignees. The loan still shows as Citi on my CR, so can I safely assume that they have not sold it? Do I still sit tight or do I reach out to Citi to try to settle? House is still underwater by $75,000+.
 

TomEason

LoanSafe Guide
HighlanderDP95

Thanks for your post.

I recommend you NOT communicate with Citi. Since your 2nd is underwater, CITI won't FC.

I recommend you continue to follow the Strategy.
 

HighlanderDP95

LoanSafe Member
So keep following this step? Will they initiate via phone or mail, because I blocked all creditor phone numbers, including Citi years ago.

b) Do not rush the settlement proceedings, to include commencing negotiation talks. Let the lender’s settlement department initiate the talks, which can range from a minimum of 6 months (very rare) to as long as several years. Be patient. Time is on your side and the passage of time will only strengthen you position.
 

TomEason

LoanSafe Guide
HighlanderDP95

Thanks for your question.

Most often these days, 2nd lenders will make a settlement offer by mail. However, you might consider unblocking Citi's number in case they do make an offer by phone.
 

HighlanderDP95

LoanSafe Member
Closing the loop on this one: after years and years of being underwater, my house finally crossed into the black about a year ago. I had been able to buy a new house four years ago (how I pulled that off is a looooong story), so this one had been a rental. Not only were the first and seconds fully paid off, but I have a little money in my pocket. Do I regret defaulting on the second? Hell, no, because I saved well over six figures in payments over 11 years and that monthly payment for the second was often the difference between monthly solvency and bankruptcy.

Some observations about Citimortgage: even though it sold its loan business back in 2017-18, it kept all of the written off loans with the Loss Mitigation Department. I have no way of knowing it, but I did not get the impression that they are super aggressive with foreclosing on seconds even though some houses have significantly regained value based on this latest bubble. I think they are sitting back and just letting the full payments to release the seconds come trickling in.

Since this ends my loan saga, I will be signing off. Thank you to this board for providing advice and comfort during some less than ideal times!
 

Jzone

LoanSafe Member
Closing the loop on this one: after years and years of being underwater, my house finally crossed into the black about a year ago. I had been able to buy a new house four years ago (how I pulled that off is a looooong story), so this one had been a rental. Not only were the first and seconds fully paid off, but I have a little money in my pocket. Do I regret defaulting on the second? Hell, no, because I saved well over six figures in payments over 11 years and that monthly payment for the second was often the difference between monthly solvency and bankruptcy.

Some observations about Citimortgage: even though it sold its loan business back in 2017-18, it kept all of the written off loans with the Loss Mitigation Department. I have no way of knowing it, but I did not get the impression that they are super aggressive with foreclosing on seconds even though some houses have significantly regained value based on this latest bubble. I think they are sitting back and just letting the full payments to release the seconds come trickling in.

Since this ends my loan saga, I will be signing off. Thank you to this board for providing advice and comfort during some less than ideal times!
Could you tell me who you contacted at CitiMortgage? I'm in a similiar situation but my last contact with Citi was that they were assigning my lien after bankruptcy to a debt collector.
 
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