Can default on a home equity loan cause foreclosure?

Question:

I was coerced into taking a home equity loan along with a mortgage refinance four years ago. The max on the loan was 15,000, of which we spent around 9,000. Since the time we did this, the monthly payments have continued to climb because of the high interest rate, and late fees. The loan has been maxed out for several months. In February we turned the account over to a credit counseling agency we are using. Today I received a summons that will account for nearly 20,000. I have never had a late mortgage payment; can I end up losing my house because of the home equity loan?

Answer:
Unfortunately yes, the house was put up for collateral. A couple of choices first call them an see if you can work something out, even if it is just paying the interest for a few months. Most lenders will work with you because it is in their best interest. Another option is to call the people with your first mortgage and see if they will re mortgage for the whole amount. Also call the credit counseling agency that you are working with, they may be also able to help. Last resort is to sell the house to pay off both mortgages.

you definately can. you put your house up as collateral. try working more closely with the credit couseling agency to work out something to pay the debt. otherwise, i would let less important bills go to keep my house.

-pay your mortgage and equity loan
-pay your water bill; they can put a lien on your house if you don't
-then send everybody else what you can, don't ignore the debt. call them in advance to tell them when you aren't making the entire minimum payment.

You bet your little A... you can. You put the house up as collateral and if you don't pay you forfeit the collateral.

Don't blame anyone but yourselves for this one. Get a part time job to go with the one you have and pay your bills. Stop spending miney you do not need to spend.

Just go past the arches and eat at home.

Some just have to learn the hard way.

If you used the house as collateral for the loan, then the lender can try to sell the property at a foreclosure sale to satisfy the defaulted loan. Check the actual loan contract to find out what recourse you gave the bank in the event you fell behind.

They may not get much out of the sale of the property if it goes to foreclosure, because the first mortgage will be paid off before any home equity loan or second mortgage. But if they are currently anticipating getting nothing from you, they may be willing to try to get as much as possible from taking the house to a sheriff sale.

But if you pledged the house as collateral on the loan, then they can try to take it from you once you default.

Good luck.

ForeclosureFish
http://www.foreclosurefish.com/...

Can default on a home equity loan cause foreclosure?

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