Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
Because of the second mortgage
, foreclosure may not still get you out from under I am afraid, since the second mortgage company can still continue to pursue you for the money. In foreclosure, both lenders can pursue you for deficiency if the home does not sell in their auction for enough to cover the balance of the loans due and in that case you would have to consider bankruptcy to get all of the remaining debts you have extinguished.
Condo fees would stop upon the foreclosure auction and would become the responsibility of the party who acquires the house in the foreclosure auction. However, until that occurs you would remain liable for those fees and again bankruptcy may be needed to extinguish this debt with the deficiency debt as well.
Generally, banks begin foreclosure about 6 months or so after you stop paying, but every bank is different and some can take 12 months and there is no guarantee when they would start.
Your two realistic options from what you said would be first hiring a local consumer protection attorney and use them to negotiate with both of your banks and your condo association to possibly give your primary lender a deed in lieu of foreclosure, which is where you give the primary lender the title to the property and they fully satisfy the loan without deficiency or 1099. This would require getting the second lender and possibly the HOA
to agree to some type of pay off.
The second option is simply go to a bankruptcy attorney and file bankruptcy and get rid of everything at one time with one attorney's fee and the property would go back to the primary lender and all of your other debts would get extinguished.
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