foreclosure

[junjun1570_2]

What is the name of your state?
Ca.
What would happen if i decided to foreclose my house, i have two loans 80-20 in same lender (Wachovia Bank), i took some money from the equity of the house. Will the Lender can go after me for the deficiency balance?

[FlyingRon]

You don't foreclose, the bank forecloses.

Only acquisition loans in California are non-recourse. They can come after you for the deficiency in a money-out loan.

[junjun1570_2]

Thanks for the input.....

I did refinance last year and took money from the equity of the house would that be considered money out loan?
If it is, would they come after me for just the money-out that i took or the whole refinance amount?

[FlyingRon]

Yes, that's what I meant when I said it. The second is not an acquisition loan so it doesn't get covered by the non-recourse protections in the California statutes.

They'll come after you for what you owe (the remaining balance on the mortgage, the unpaid interest due, and legal fees involved in collecting).

[junjun1570_2]

Thanks again for the input.

I am having a financial crisis right now and can no longer afford to pay my first mortgage. What would be my option at this point? What would happen if i continue paying my second mortgage but not the first mortgage? What would happen to the second mortgage if the First Mortgage will forclose my house?

By the way, my first & second mortgage are from same lender.

[FlyingRon]

You don't pay, you get foreclosed on.
If the money doesn't pay off the second, they come after you for a judgment. If you've got no other assets and no potential to get some, chances are they might roll over and give up, but you can't be sure.