If you are struggling with your second mortgage, you aren't alone! Second mortgages are just what they sound like, an additional mortgage on the same home. Many are structured as Home Equity Lines of Credit (“HELOC”s) and put money into the homeowner’s pocket at the time the loan is taken out. People take them out for all kinds of reasons- home improvement, to pay down debt, etc. By comparison to the first or principal mortgage, the amount may seem inconsequential but when stacked on top of the main mortgage and when interest is added, the monthly payment becomes a problem for many people. Since the loan is secured by the house (which becomes the collateral), second mortgages are only given out to the extent that there is equity in the home. Nowadays, many people with old HELOCS or second mortgages no longer have the value in the home that they once did, given the recent housing market crash which leaves them paying more in total than what they owe on the house.
If this sounds familiar and you are having a hard time keeping up with bills, you may want to see if you qualify for a Chapter 13 bankruptcy because it is possible that you will end up only having to pay for the first mortgage and not the second. To learn more about debt relief for homeowners in Illinois, give us a call at 630 250-8813 to set up a free, no obligation consultation. Or, if you aren’t ready to sit down and speak with someone and would just like some information, claim your free book “Bankruptcy Myths Exposed” by filling out our webform.