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Frequently Asked Questions


General Mortgage Questions


How do I know USA Payment Relief owns my loan?
You should have received a letter stating that USA Payment Relief is the new owner (Investor). If not, contact your previous mortgage loan  owner, or we can email proof of ownership once you contact us.

I filed bankruptcy, so I didn’t think I was responsible for this loan any more. Is this true?
If you want to stay in the property, the property’s debt must be paid.

What happens if I file bankruptcy?
Filing bankruptcy may release you personally from the obligation of paying the loan; however, the loan is still a secured lien against the property, in order to stay in the property all secured liens must be paid regardless of secured lien position. In addition any fees associated with bankruptcy will be added to the payoff amount you owe.

If my loan was charged-off, what does that mean?
It does not mean the loan disappeared; it means that the owner of the loan purged it from their books. That means they may sell it to another entity or sell the rights to collect on it to another servicer.

Why is my payoff more than what I borrowed even if I have been paying sometimes?
Each missed payment, increases the payoff by that amount, plus late fees. For example. For every $400 payment you don’t make, your balance of the loan goes up $400 for every month you don’t make the payment.

Why do I have a negative amortization with my loan?
Because you are paying less than your regularly scheduled payment, your principal balance goes up instead of down each month.

What are the advantages of avoiding a foreclosure?
Your credit score will rebound faster, and you can control the outcome using your plan instead of the lender and the lender’s attorneys plan.  Plus if you have a 2nd mortgage loan that is a HELOC loan, the foreclosure will not wipe out the debt owed to the 2nd mortgage.

Why does my interest rate change on my current loan?
It is a variable note, which means that your rate will fluctuate. Your loan specialist can help you avoid this by fixing your rate.


2nd Mortgage Questions


I am current on my 1st mortgage. How can you foreclose?
Yes, you can foreclose from any secured lien position.

Can you legally foreclose from second position?
Yes, you can foreclose from any secured lien position, without paying off the first mortgage at time of foreclosure, regardless of the value of the house.

My first mortgage told me not to worry about paying my second mortgage, is this true?
No, the second mortgage holder has the right to foreclose on a property. Please confirm this with your attorney.

If the 1st Mortgage Forecloses on my Home, does the 2nd Mortgage Loan get wiped out ?  If the 2nd Mortgage Loan was a purchase money loan, than the 2nd Mortgage will get wiped out as a result of the 1st Mortgage lender foreclosure.  A 2nd purchase money loan, is a loan with fixed balance and that was made on the same day as the 1st Mortgage when the property was purchased.  If the 2nd mortgage loan is a HELOC Loan, and if the 1st Mortgage lender forecloses on the home, than the 2nd HELOC loan is removed from the subject property, but is still a valid unsecured debt that is owed by the original borrower.

Does a Short Sale eliminate my 2nd Mortgage Loan ?  Yes, but only if the 2nd Mortgage Loan Holder agrees to the terms and conditions of the short sale, and the 2nd mortgage lender agrees in writing to a settlement of the loan debt at the close of the short sale escrow.  In order for the 2nd Mortgage loan holder to agree to a short sale, the 1st mortgage holder has to offer a pay-off incentive to the 2nd mortgage holder in most all cases.

What is  HELOC Loan?
HELOC stands for Home Equity Line of Credit, or simply “home equity line.”   Most HELOCs are second mortgages, and are set up as a line of credit for some maximum draw, rather than for a fixed dollar amount. For example, using a standard mortgage you might borrow $150,000, which would be paid out in its entirety at closing. Using a HELOC instead, you receive the lender’s promise to advance you up to $150,000, in an amount and at a time of your choosing. You can draw on the line by writing a check, or using a special credit card.

HELOCs have a draw period, during which the borrower can use the line, and a repayment period during which it must be repaid. Draw periods are usually 5 to 10 years, during which the borrower is only required to pay interest. Repayment periods are usually 10 to 20 years, during which the borrower must make payments to principal equal to the balance at the end of the draw period divided by the number of months in the repayment period.  Because the balance of a HELOC may change from day to day, depending on draws and repayments, interest on a HELOC is calculated daily rather than monthly.

 

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