I have been “Stripped Off” before

I have been “Stripped Off” before

 

 

The Supreme Court got this one right and it is about damn time. I hate to think about how much money I have been screwed out of over the years. Here is one example:

 

In 1987 I personally did a second mortgage for someone in order to save their home from foreclosure. No point of debating why I did it, but I did.

 

Everything was going along just fine for two years and then these people stopped paying and I never pursued starting a foreclosure. I just figured at some point I would get paid whenever these folks sold the property. In 1992 the people filed a chapter 7 bankruptcy. Even though I filed a claim with the court, my second mortgage was stripped away by the BK court as there was no equity in the property. In 1996 the property was sold, sold for a lot more than the first mortgage balance. I got nothing and would have been paid in full.

 

I can understand that the bankruptcy lets the borrower off the hook from paying, but when they grant the right to eliminate a second mortgage this authority went much too far. That is why the Supreme Court finally got this one right. Below is an article on the topic.

 

http://www.dsnews.com/news/06-01-2015/supreme-court-outlaws-chapter-7-stripping-off-of-second-mortgages

 

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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

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Comment balloon 27 commentsJoe Petrowsky • January 05 2016 08:16AM

Comments

Seems like it took them long enough to get it right Joe.

Posted by Roger D. Mucci, Lets shake things up at your home today! (Shaken...with a Twist 216.633.2092) over 3 years ago

In a short....the second will likely get a fraction of what is owed...and they have come to realize a fraction beats nothing....or waiting forever.

Posted by Sally K. & David L. Hanson, WI Realtors - Luxury - Divorce (EXP Realty 414-525-0563) over 3 years ago

Good Morning Joe - It makes no sense and it is good the the Supreme Court recognized that.

Posted by Grant Schneider, Your Coach Helping You Create Successful Outcomes (Performance Development Strategies) over 3 years ago

Oh yes, that doesn't sound right at all.  Glad they finally fixed.

Posted by Women of Westchester Working Together, Women helping Women get ahead (Women of Westchester Working Together) over 3 years ago

Good morning Joe. We have some "gret escape? laws that don't make much sense! Enjoy your day!

Posted by Wayne Martin, Real Estate Broker - Retired (Wayne M Martin) over 3 years ago

Good morning Joe.  As so goes the justice system, by the time they get it right most people are no longer around to reap the ruling.

Posted by James Dray, Exceptional Agents, Outstanding Results (Fathom Realty) over 3 years ago

Joe- what is it they say about a blind squirrel gathering a few nuts? Finally common sense and doing something because it's just right wins

Posted by Kathy Streib, Home Stager - Palm Beach County,FL -561-914-6224 (Room Service Home Staging) over 3 years ago

Hi Joe... I enjoyed reading about this, as I must say, I hadn't given the issue much thought because I didn't know anyone affected by it. Glad someone got something right for a change in our government.

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Residential Brokerage ) over 3 years ago

Good morning Joe,

All pains in the derriere we get from the politician's and attorney's!

Make yourself a great day.

Posted by Raymond E. Camp, Licensed Real Estate Salesperson Greater Rochester (Howard Hanna Real Estate Services) over 3 years ago

Good morning, Joe -- thanks for the news.  As Nina Hollander commented, I also hadn't given much thought to this as it wasn't something I had any experience. It is nice to see a positive outcome.  

Posted by Michael Jacobs, Los Angeles Pasadena 818.516.4393 over 3 years ago

I would be curious as to how this might carry forward to short sale situations where the max for a secondary note is fixed at $6,000.  I have had deals where the second lien holder got next to nothing and the first lien holder got their complete value in a short sale.  In many of those, BOA was the first lien holder and they were just fine with that.  The Supreme court decision has BOA as the second lien holder.

Posted by Ed Silva, Central CT Real Estate Broker Serving all equally (RE/MAX Professionals, CT 203-206-0754 ) over 3 years ago

Well Joe Petrowsky Done is done, as they say. Too bad for you, but at least future second TD holders will not be "stripped off."

Bill Roberts

Posted by Bill Roberts, "Baby Boomer" Retirement Planner (Brooks and Dunphy Real Estate) over 3 years ago

Joe,

Glad to hear that the Supreme Court got it right. Happy Thursday, A

Posted by Ron and Alexandra Seigel, Luxury Real Estate Branding, Marketing & Strategy (Napa Consultants) over 3 years ago

Joe life is not fair and many things do not make sense.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) over 3 years ago

This is very good information to share. Many second mortgage holders have lost their interests.

Posted by Roy Kelley (Realty Group Referrals) over 3 years ago

Joe: Like Nina, I do not know anyone in my market who has been affected by this but it is good to see the Supreme Court making a smart decision.

Posted by Anita Clark, Realtor - Homes for Sale in Warner Robins GA (ColdwellBanker SSK Realtors ~ 478.960.8055) over 3 years ago

Doesn't seem right that no one would recognize your debt and at least satisfy part of it.  Guess you won't be doing that again.

Posted by Belinda Spillman, Colorado Living! (Aspen Lane Real Estate Colorful Colorado) over 3 years ago

I have never met anyone who has gone through this, then again I never knew to ask. Glad positive changes are being made. 

Posted by Shannon Milligan, Richmond VA Real Estate Agent/Associate Broker, RVA Home Team - Winning with Integrity. (RVA Home Team) over 3 years ago

Thanks for this Joe, they got something right. Having done many short sales, I have the same question as Ed Silva, hope they will look into this as well.

Posted by Beth Atalay, Cam Realty of Clermont FL (Cam Realty and Property Management) over 3 years ago

I've never been a fan of that in foreclosure either.

Posted by Tammy Lankford,, Broker GA Lake Sinclair/Eatonton/Milledgeville (Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668) over 3 years ago

Hi Joe.  The bankruptcy laws are being manipulated by devious people.

Posted by Conrad Allen, Webster, Ma, Realtor (Re/Max Professional Associates) over 3 years ago

Something is better than nothing but being in second postion is never very secure in hard times.

Posted by Debbie Reynolds, Your Dedicated Clarksville TN Real Estate Agent (Platinum Properties) over 3 years ago

No good deed goes unpunished. You tried to help someone and got poked in the eye by the BK system.

That system is being used to defraud legitimate creditors, as was shown in your case. It needs to be overhauled,

 

Posted by Thomas McCombs (Century 21 HomeStar) over 3 years ago

What a story Joe. Really interesting from your point of view.

Posted by Noah Seidenberg, Chicagoland and Suburbs (800) 858-7917 (Coldwell Banker) over 3 years ago

Hi, Joe. You opened my eyes to something I wasn't even aware of. I had never even given this a thought before. Thank you for sharing your story and shedding some light on something a lot of us knew nothing about. 

Posted by Debbie Laity, Your Real Estate Resource for Delta County, CO (Cedaredge Land Company) over 3 years ago

Glad to hear that the Supreme Court got it right....lets hope this isn't he last one.

Posted by Rebecca Gaujot, Realtor®, Lewisburg WV, the go to agent for all real estate (Vision Quest Realty) over 3 years ago

Hi Joe.  Nice to see something that the government gets right.  Doesn't seem all that often these days.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) over 3 years ago

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