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Did You Get Foreclosed on With a Second Mortgage or Home Equity Loan? I Knew This Was Going to Happen.

If you or someone you know got foreclosed on and had a second mortgage or home equity loan, watch out!

Foreclosure SignPeople who were foreclosed on may think their debt problems are now behind them but second mortgage holders are not taking this lying down. In a move to attempt to recover money lost in the second mortgage banks held on some of these foreclosed properties we should expect to see deficiency claims made by the banks to recover funds.

This is what recently happened to Charissa Kolich of San Diego. After her foreclosure last year she thought the problems with the real estate debt were behind her. But her lender Wells Fargo had a different view of things. Wells filed suit against Kolich in San Diego Superior Court in an attempt to collect $72,000.

If the banks themselves don’t go after the lingering loans then don’t be at all surprised to see these loans packaged and sold like bad unsecured debt to new owners to collect.

This is yet another example of why anyone that was foreclosed on or is facing foreclosure should consider filing bankruptcy afterwards. A bankruptcy will neutralize any claim a home equity or second mortgage lender may have against the foreclosed homeowner and really close the door on the skeleton debt.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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