Sentences with phrase «junior liens»
"Junior liens" refers to loans or lines of credit that are taken out after a primary loan has already been secured. These secondary loans have a lower priority and are paid off after the primary loan in the event of a default or foreclosure. Full definition
A deed in lieu of foreclosure does not protect your credit, nor will it cut off the rights of junior lien holders.
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Cash - out or consolidation of junior liens is not allowed.
In some cases, multiple lenders might work out an arrangement that leaves more collateral for junior lien holders.
However, the bankruptcy laws do allow junior liens to be stripped from your primary residence in a Chapter 13 bankruptcy.
Many years ago, a group of investors came together to create a unique lending company that specialized in junior liens.
With employment at an all time low, and the lack of underwriting for junior liens, it's only natural to see a dip in supply of that particular type of product.
This leaves them facing exclusion from future home ownership for many years, deficiency judgments from junior lien holders and higher costs to borrow money for 2 - 3 times longer then a short sale would have impacted them.
But in the nonperforming note world, especially with junior liens, many of these things are just plain missing.
With today's real estate market still struggling to recover, this means that many people are able to remove junior liens on properties refinanced or purchased since 2004.
Lien Stripping in Chapter 13 Bankruptcy For our readers playing along at home, the basic rule with mortgage modification in bankruptcy is as follows: first mortgages on a debtors primary residence can not be modified by filing for bankruptcy, however, second, third and other junior liens can be modified or «stripped» by filing for Chapter 13...
The lender will also explain the prohibition against new junior liens against the property unless directly related to property maintenance, and a minimum of 50 percent equity and appreciation sharing with the Federal government.
Strip Off: Treating a wholly unsecured second or more junior lien as an unsecured debt.
In today's declining real estate market, this ruling pretty much allows junior lien removal on most properties bought or refinanced since 2004.
However, at this time, it only works on junior liens like 2nd and 3rd mortgages.See how to settle your note for pennies.
Additional hurdles to loan modification include junior liens, which often must extinguished before the original mortgage can be modified, and contractual agreements between the banks and investors who purchased mortgages on the secondary market.
In many cases, debtors can completely eliminate junior liens either in a Chapter 13 or Chapter 11 Bankruptcy!
Drafted complaints and motions including complaints / motions to avoid junior lien, motions for default
Even junior liens with no equity (or low equity) can still be viable investments because the borrower usually has a vested interest in the property, and traditional equity may not always be the sole factor when it comes to remaining in the home.
The property might have several junior liens that the listing agent never took the time to learn about, creating a snag later in the process and raising a question in the lender's mind about the preparation of the agent.
This leaves them facing exclusion from future home ownership for many years, deficientcy judgments from junior lien holders and higher costs to borrow money for 2 - 3 times longer then a short sale would have impacted them.
(Note, too, that the approval of junior lien holders may be required to restructure home loans.)
However, if during your repayment plan, you are able to strip your home of its second mortgage or other junior lien or cram down your auto loan and not pay off the entire balance, creditors can seek payment of those debts from your ex-spouse.
Section 32 of RESPA kicks in on certain owner - occupied loans where the APR is more than 8 % above the rate on comparable treasuries for first liens, and 10 % above the rate on comparable treasuries for junior liens, when compared to treasury rates for the 15th of the month, in the month prior to when app was taken.
Wiping out junior liens on real estate may be a possibility, too.
The SBA describes the program thusly: «Typically, a 504 project includes a loan secured with a senior lien from a private - sector lender covering up to 50 percent of the project cost, a loan secured with a junior lien from the CDC (a 100 percent SBA - guaranteed debenture) covering up to 40 percent of the cost, and a contribution of at least 10 percent equity from the small business being helped.
They are also called «junior liens,» because if the borrower defaults and the property is foreclosed and sold, the lender with the first mortgage gets repaid first.
All subordinate / junior liens must be resubordinated to the new first mortgage.
They are also called «junior liens,» because if the borrower defaults and the property is foreclosed and sold, the lender with the first mortgage gets repaid first.
b) The sum of the existing first lien, any purchase money second mortgage and / or any junior liens over 12 months old, closing costs, prepaid expenses, accrued late charges, escrow shortages, borrower paid repairs required by the appraisal, discount points, prepaid penalties charged on a conventional loan and FHA Title 1 loans as determined by the appropriate HOC subtract any refund of refund of upfront MIP.
Refinance transactions, which require subordination agreements, may require approved subordinations from the junior lien holder prior to the rate being locked.
All subordinate / junior liens must be resubordinated to the new first mortgage.
In the cram down scenario, there is no requirement that there be a junior lien before your primary loan can be chopped, however, loans made within 910 days of filing are not eligible for cram down.
In other words, the lender would take the property back subject to the junior lien holders.
The junior lien - holder only gets repaid if there is enough money left over.
One of the key issues at play is what happens to junior lien - holders (JP Morgan Chase alone has over $ 130 billion worth of secondary loans in its portfolio) in the event of modifications.
So the debt that the bank is forgiving, the loan amount that is being forgiven must have originally been used to either purchase the house, what we call purchase money, or when we're talking about a second, a junior lien, a subordinate lien or a home equity line of credit, those proceeds must have been used to substantially improve or repair the house.
Whatever money is left over from paying off the 1st mortgage will now go towards paying off the junior lien holders.
Some lenders call a second mortgage a «junior lien.»
McNeal sought to strip off the second priority lien based on the grounds the primary lien exceeded the fair market value, and the junior lien was now wholly unsecured.
The hurdle with secondary liens is that lien priority requires that junior liens be paid prior to modifying the first mortgage.
Relatively few banks are participating in programs to write down junior liens.
Your lender may require you to certify that there are no junior liens (such as a second mortgage) on your home.
In finance terms it is a «junior lien» that sits behind the 1st loan on title.
Chapter 13 is the only chapter that provides this; in order to «strip» a junior lien, the chapter 13 debtor must prove that the junior lien is completely unsecured - that is, that the value of the home is less than the balance of the existing first mortgage.
That incentive payment could be applied towards settling junior liens - so, if a junior lien - holder was playing hardball, holding out for more money in order to release a lien, the seller might be forced to use their incentive money for that purpose, and never actually see any of the cash.
The supplemental loan can be part of the first mortgage (for example, if you take it out when you purchase your home) or a junior lien (second mortgage).
Plus, there is a little known provision in chapter 13 that could potentially remove any junior liens that are on your house (e.g., second mortgage, etc.).
They are called «second mortgages» or «junior liens,» because if you end up in foreclosure, the lender with the home equity mortgage only gets paid off after the lender with the first mortgage.
For larger deals, that may require multiple lenders, those who are agreeable to a junior lien position can be rewarded with higher interest rates.