Quote: (05-16-2014 10:16 PM)renotime Wrote:
Quote: (05-16-2014 11:05 AM)el mechanico Wrote:
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Also - for those declaring bankruptcy - do they have to give up their expensive houses - or do they get to keep them?
Haha keep them. Bankruptcy is a very powerful tool and a great way to play "chicken" with the banks. Some people have no choice as they are unreasonable and a bankruptcy judge will force them to come to the table that's why so many people use it.
Not only do they keep them if underwater they can reduce your principle and it's almost automatic on vacation houses or second homes, second mortgages and other unsecured debts get wiped off pretty much.
This is a very complicated subject.
I own a non performing second mortgage on a guy that filed chapter 7 bankruptcy a few years back. He still lives in his house and is still paying his first mortgage.
I'm not really sure what BK court absolved him from paying.
When I started calling the guy he was convinced he didn't owe anything on the second because he had filed bankruptcy. He thought the lien had been wiped.
Since there is no equity in the second mortgage he could potentially go back to BK court and have the lien wiped.
As far as second mortgages go, as long as there is equity in the lien, the mortgage can't be wiped.
So right now I'm gonna let this borrower pay down his first, let some equity accrue, and then call him up again to work something out.
He'll probably try to run back to BK court, but he won't be able to do shit.
You better talk to a lawyer. There's a good chance you're fucked.