If we have a second morgage and cannot pay the amount that the bank wants monthly,are we wasting our time paying?

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If we have a second morgage and cannot pay the amount that the bank wants monthly,are we wasting our time paying?

So we have been sending a lesser amount per month. They have been cashing the checks but no invoice or record of payment has been sent to us.

Asked on February 29, 2012 under Real Estate Law, Florida

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

What do you mean by "wasting your time"?

If you are paying less than the required amount, you are in default, and the bank could initiate a foreclosure and/or sue you for the money you owe. In that sense, yes, you might be "wasting your time," since partial payments do not prevent the lender from taking action.

On the other hand:

1) it may be that as long as it's getting some money and you are evidently trying to pay, the bank won't take action--you might be buying yourself time;

2) you are reducing how much owed, which could help in the event the bank sues you for the balance due on the loan;

3) in the event of any later litigation, the fact that you are showing good faith efforts to pay can sometimes help--at a minimum, it may stop a court from imposing additional sanctions on you, such as they sometimes do on litigants who demonstrate bad faith.

In the above sense, you are not wasting your time; there are gains from partial payment, even though, again, it does not stop the lender from taking legal action if it chooses. What you need to weigh is what would you do with that money if you didn't make the partial payments?


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