Negotiating a Second Mortgage After a Divorce

We commonly see cases where one spouse is awarded the house in a divorce case, but the divorce decree and/or settlement agreement fails to address a second lien taken out by the other spouse. When that happens, the spouse who got the house often also gets stuck with the second lien, even if his or her name is not on the second mortgage! Meanwhile, the now-ex who took out the second mortgage has moved out, and either isn’t interested in, or can’t, pay off that second mortgage.

The good news is that a lawyer can help with this. We recently negotiated an out-of-court settlement in which the investor agreed to accept a fraction of what it claimed it was owed under the second mortgage. This brought peace of mind to our client, who no longer needs to worry about interest continuing to accrue, or worse, a foreclosure action being filed to enforce the second mortgage.

It is also sometimes possible to get rid of a second mortgage altogether in a bankruptcy case. Get in touch with us to find out more.