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RealEstateAnswer, Lawyer
Category: Real Estate Law
Satisfied Customers: 28077
Experience:  10+ years in handling Leases, Landlord-Tenant, Foreclosures,Mortgages, and Eviction cases
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About 9 years ago we had a beach house we bought but then

Customer Question

About 9 years ago we had a beach house we bought but then the real estate market bottomed in Florida. We had a first and a second on this beach house. We bought it for an investment but that didn't work out. Our only option was to short sale it. The second mortgage company received $10,000 of the $60,000 that was owed but they also said my husband were responsible for the other $50,000. My understanding is the debt should have been cleared at the closing. However, they have threatened to ruin us if we do not pay back the $50,000. We have been making monthly interest only payments for all these years. They will not let us roll into permanent financing. What options do we have?
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  RealEstateAnswer replied 1 year ago.

Good morning. Did you sign anything when the short sale was approved that you would be liable for any balance owed to the 2nd for them to agree to this and release their interest? Also, you said you have been making payments, so if you thought this should have been cleared, why did you not address this back then and why it is interest only, without anything going to principle?

Expert:  RealEstateAnswer replied 1 year ago.

Hi, are you still with me?

Customer: replied 1 year ago.
We did sign a letter saying we would repay because the guy said if we didn't he would stop the short sale and would force us into foreclosure. We have tried several times to roll into permanent and also lump sum short pay but they refuse both. They said we would have to seek new financing to pay them off. Our entire situation has changed as my husband has retired and I am the only source of income.
Expert:  RealEstateAnswer replied 1 year ago.

Thank you for the additional situation. Something is VERY odd about this. You 100% need counsel to look over exactly what you signed regarding repayment and the terms regarding interest and the terms. I say this because they could not continue to just charge you interest only and never pay down the principle of what is owed. There is nothing wrong and it is actually very common for a 2nd lender to want the balance paid on a short sale but the principle needs to be paid down and it can not remain interest only. Moreover, I have never heard of a lender saying they will require you to pay interest only and not extend any type of plan to pay off principle and interest. As such, you could have grounds to go after them and possible sue, if the contract which they had you signed was illegal or so one sided, that it would be unconscionable.

Expert:  RealEstateAnswer replied 1 year ago.

I wanted to follow up and see if there is anything else I can answer or clarify. I am here to help so please just let me know