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Mortgage Foreclosure Laws In Texas Article
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Second Mortgage Foreclosure vs. a First Mortgage Foreclosure
from:Getting a mortgage is a large step for homeowners. Many make jokes about mortgages and buying their homes calling it "signing their life away". Although it's not quite that serious, taking out a mortgage loan is a huge step. You'll be agreeing to make monthly payments, which include principal and interest, for many years, sometimes up to 30 years. Often by time you've finished paying off your loan, you'll have paid for it two times or more with the interest included.
If the borrower fails to make the scheduled payments on time, they risk losing their home to foreclosure. No one comes out ahead in the foreclosure, not the lender or the borrower. Whether it's a first mortgage foreclosure or a second mortgage foreclosure, it's a big headache for everyone involved. Banks don't like having an REO (Real Estate Owned) on their record and borrowers don't want to lose their home.
In addition to losing their home, they'll have a poor credit rating for many years, which will make it difficult for them to get any credit in the near future. Regardless of whether it's first or second mortgage foreclosure, their credit will be affected the same. You probably understand what a mortgage and mortgage foreclosure is, but many are unfamiliar with second mortgages or second mortgage foreclosure.
An individual buys a home for $100,000 and has a $20,000 down payment. They then take out a mortgage loan for $80,000. We're assuming the home is worth at least $100,000 because banks usually borrow up to 80% of the appraised value of the home. A few years later, the borrower decides to take out a second mortgage. He may be having difficulties making his first mortgage payment and needs cash to be caught up or may also just need extra cash for some expense.
At this time, his home is appraised at $120,000 and his first mortgage loan balance is down to $70,000. He, therefore, has $50,000 of equity to borrow on his home. Following with the 80% rule, he can probably get a second mortgage for up to $40,000. The second lender's name will be on the mortgage under the first mortgage lender because the first has precedence on the loan. Therefore, at this time the borrower owes $70,000 on his first loan and $40,000 on the second loan.
If the borrower cannot make payments on the loans and the loan goes into first mortgage and second mortgage foreclosure, the first lender will get their money before the second. If the home is foreclosed and sold for $100,000, the first lender will get the $70,000 owed to them, with only $30,000 left so the second lender will only get $30,000.
If there is a second mortgage foreclosure but not a first mortgage foreclosure, the second lender may be allowed to make payments to the first lender. Unless it can't be avoided, try to avoid a second mortgage for all concerned.
Mortgage Foreclosure Laws In Texas News
A Law Shielded Many Texans When the Housing Bubble Burst - New York Times
A Law Shielded Many Texans When the Housing Bubble Burst New York Times The state was not spared all the excesses of the mortgage boom, said John Fleming, the general counsel of the Texas Mortgage Bankers Association, who also teaches consumer credit law at the University of Texas School of Law. |
REAL ESTATE: Texas firm targets homeowners with foreclosed 2nd mortgages - Press-Enterprise
 Press-Enterprise | REAL ESTATE: Texas firm targets homeowners with foreclosed 2nd mortgages Press-Enterprise BY RICK JURGENS Adding new uncertainty in the state's ongoing mortgage crisis, a Texas company is aggressively pursuing hundreds of Californians to collect second-mortgage debt – on homes they've already lost through foreclosure. Texas firm targets Calif. homeowners with foreclosed 2nd mortgages |
Firm Targets Calif. Homeowners With Foreclosed 2nd Mortgages - KGTV San Diego
Firm Targets Calif. Homeowners With Foreclosed 2nd Mortgages KGTV San Diego SAN DIEGO -- Adding new uncertainty in the state's ongoing mortgage crisis, a Texas company is aggressively pursuing hundreds of Californians to collect second-mortgage debt -- on homes they've already lost through foreclosure. |
Firm targets CA homeowners with foreclosed 2nd mortgages - abc7news.com
 abc7news.com | Firm targets CA homeowners with foreclosed 2nd mortgages abc7news.com He could no longer make his house payments, and like 800000 other Californians, the bank foreclosed on his home. This should have been the end of the story. Once a house has been sold in foreclosure, California law protects homeowners with loans like ... Foreclosure victims sued - ABC7 investigation |
May 31st Deadline to Protest Your Property Appraisal - Texas Insider
 Texas Insider | May 31st Deadline to Protest Your Property Appraisal Texas Insider Since I joined the Texas Senate in 2007, I have worked to lower property taxes. Although the State of Texas is a genuine low tax state, the property taxes we face are among the highest in the country. My proposals have included pushing to lower the ... |
Billion Dollar Bait & Switch: States Divert Foreclosure Deal Funds - UK Progressive Magazine
 UK Progressive Magazine | Billion Dollar Bait & Switch: States Divert Foreclosure Deal Funds UK Progressive Magazine by Paul Kiel and Cora Currier, ProPublica States have diverted $974 million from this year's landmark mortgage settlement to pay down budget deficits or fund programs unrelated to the foreclosure crisis, according to a ProPublica analysis. |
Bid Filed by BofA & MERS Dismissed - Zacks.com
Bid Filed by BofA & MERS Dismissed Zacks.com According to Bloomberg, the federal judge in Texas (Dallas) has rescinded the bid filed by Bank of America Corporation (BAC - Analyst Report) and Mortgage Electronic Registration Systems Inc. (MERS). The bid was related to the dismissal of claims under ... |
Bid Filed by BofA & MERS Dismissed - Analyst Blog - NASDAQ
Bid Filed by BofA & MERS Dismissed - Analyst Blog NASDAQ According to Bloomberg , the federal judge in Texas (Dallas) has rescinded the bid filed by Bank of America Corporation ( BAC ) and Mortgage Electronic Registration Systems Inc. (MERS). The bid was related to the dismissal of claims under a lawsuit ... |