Sherman Oaks Second Mortgage Lawyers
Taking out a second mortgage on a home is fairly common. If you have a reasonable amount of equity built up in your home, a second can be a financially viable way to pay off credit card debt, medical debt, student loan debt, or obtain cash to make major home modifications that would not be possible otherwise. Generally, homeowners are able to borrow up to 85 percent of their home’s value, minus the first mortgage debt. However, if you are unable to make monthly payments on your second home mortgage, the borrower can seize control of your home. Yet, there are ways a lawyer can help you stave off foreclosure and losing your home and all the money, time, and memories that you have put into it. The Sherman Oaks second mortgage debt lawyers at Wadhwani & Shanfeld can help you negotiate a more reasonable mortgage, refinance the mortgage, settle with the lender, accomplish a short sale, or figure out a repayment plan by filing for Chapter 13 bankruptcy.
Home Equity Line of Credit Vs. Home Equity Loan
There are two types of second mortgages: a home equity line of credit (HELC) and a home equity loan. The former (home equity line of credit) has a variable interest rate, but allows the borrower to take out money whenever they need it, and pay it back in an agreed upon timeframe. Generally, a HELC is safer, but the borrower’s home is still used as collateral and the bank can foreclose if the borrower fails to make payments. A traditional home equity loan is a one lump payment from the bank to you, also with your home as collateral. In either case, the bank can seize your home if you fail to make mortgage payments.
Options to Avoid Foreclosure
Depending on your circumstances, a lawyer may be able to assist you with one of the following types of foreclosure defenses, allowing you to continue living in and owning your home:
- Debt settlement—An attorney can represent you in negotiating a settlement of the debt, or changing the terms of the mortgage payments.
- Refinancing—This lowers the interest rate of your second mortgage, making payments easier. Usually the first and second mortgages are combined into one new primary home loan.
- Filing for Chapter 13 bankruptcy—Chapter 13 bankruptcy creates a repayment plan that works for you. Any remaining debt after the plan period ends will be discharged.
Debt settlement, refinancing, and bankruptcy does not work for everyone, nor can all homeowners qualify. A short sale does not save your home from the bank (you lose the home), but it may offer a better financial outcome than foreclosure by paying off much of the debt, and being forgiven for the rest.
Call a Sherman Oaks Second Mortgage Lawyer Today
Are you facing foreclosure because you have been unable to pay your second mortgage? Do not give up hope. An experienced Sherman Oaks second mortgage lawyer may be able to save your home and vastly improve your financial future. Do not hesitate to call Wadhwani & Shanfeld today at 899-996-9932 to schedule a free consultation.