I published an article back in April of 2011 outlining the process that I went through when I settled the 2nd mortgage on my personal residence.
(Disclaimer: I am not an attorney. This is being provided for informational purposes only and should not be construed as legal advice. If you have a matter that requires legal advice, please consult with the proper legal counsel.)
For my situation, the process was a bit harrowing, but I got through it nonetheless. The reason this information is timely is because of the state of the real estate market presently. We are nearing a balanced market, but we are still in a seller’s market. As a result of the past two years of this Seller’s Market, a reduction in the available inventory and increased demand due to low interest rates have provided upward pressure on pricing, forcing a relatively healthy gap between the cost of a home with equity and a home that’s distressed. There are less and less distressed homes on the market each and every day.
Since prices have come up, many of you are in a situation where you may be upside down on your home due to the combined balance of your 1st and 2nd mortgage, but if you didn’t have a 2nd mortgage, you’d be right side up with equity.
(Disclaimer: I am not an advocate of bailing on your obligations. I was forced into a settlement situation by a combination of factors, and upon attempting to make good on my promise to re-pay, I was denied by the lender. I would suggest working your tail off to fulfill your promise unless you absolutely are unable to do so.)
My Settlement Agreement with MidFirst Bank
I’ve decided to make my settlement agreement available to you so you can see the type of verbiage that banks will put into the agreements when they settle the debts. The document is edited and various data is blocked out, but you should get the picture regarding the nature of the agreement.
As in any debt settlement, it was critical that the lender initiate the document upon my request and specific instructions so that it is in writing from them to you before any money changed hands.
You can download this file right now using the following link: