Legal Question in Real Estate Law in Illinois
Unable to pay off 2nd mortgage
What steps can be taken if unable to pay off a 2nd mortgage that has ballooned? All payments to 1st and 2nd mortgages have been paid on time. There is not enough equity in property, as yet, to refinance it to pay off the 2nd. An extenstion has been asked for, but there are several parties involved in the 2nd and are not in agreement. Thank you.
1 Answer from Attorneys
Re: Unable to pay off 2nd mortgage
The second mortgage company could foreclose if it is not paid off at the balloon date. The tricky part is that they would have to buy out the first mortgage in order to be able to do anything with the property. I take it from you reply that there is not much equity after the first mortgage, so I would think it unlikely the second mortgage company would do this.
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