In most cases tje lenders allow you a specific pre-payment amount. Paying early a mortgage is the same as breaking the mortgage and transfering to another lender. The only difference, you would pay an extra amount for getting the discharge documents. (You should register the discharge at the land registry office to make sure there are no liens and encumbrances on the property)

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Recently my common-law spouse and i have decided to seperate. we bought a house in 2008 and we signed our mortgage for a five year term. i spoke with my mortgage company and they informed me that if we sell our house without getting another mortgage on a differnt house we would have to pay a $20,000 penalty. the only other option is that one of us buys the other one out, but neither of us can afford to do that right now. what are my options? i need help, i really dont know what to do.

You got a mortgage with a huge prepayment penalty. $20,000 seems like it would be worth hiring a good attorney to look the papers over for a loop hole.

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I moved into my home about 2 years ago. my loan was a first time homebuyer bond loan that said i must occupy the property as long as that loan is active. i've always made my payments on time. a few months ago i got married and moved into my husband's house. i tried for several months to sell my house with no luck so i rented it out. i never told the lender, i just kept paying the mortgage payment on time each month. they just sent a letter saying i've moved and that's against the terms of the loan and i have the following 4 options: 1) refinance, 2) sell the house, 3) move back in, 4) submit a request to temporarily vacate the property. how did they know i moved? could it be from when i changed my social security card and drivers license to my new name and address? what can i do to not have to not refinance but keep my tenant renting from me? can i keep the house for sale for a whole year without it selling and not be penalized? i need advice from people who really know.

Either move back in to the house and place it for sale. Eventually you will have enough equity to price it so it sells. OR, re-finance it (so it is no longer under the bond program) and then you can do with it as you please. Recognize though that the bond program is our tax dollars at work, helping out someone who otherwise can't buy a house. Well that's not you anymore. I don't think you'd like the idea of paying for someones (food, clothing, house, beer, etc) because "they need the help" only to find out later that they kept on taking the money after they no longer needed the help.... I'm NOT acusing you of purposefully taking advantage of the system - I understand that your situation has changed - that is a good thing. But you should refi to give back the money now that you don't need it. BTW - Did I read your avatar and question correctly? RYAN has now moved in with his husband?

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After separating and before divorcing, my now ex-husband agreed through the court system to pay full rent to live at our house while i moved back home with my parents. that was fine with me b/c i couldn't afford the note at the time and he could but he carelessly let the house slip into foreclosure b/c he got behind on the payments. skipping ahead to the present, nobody lives there now and it's been on the market but hasn't been able to sell. it's going to auction in 2 1/2 weeks with both of our names on the title but only mine on the mortgage so only i will be penalized if it auctions. our last ditch effort is selling the house as is for the base price with no profit (which is fine by me) and we've started the process and will be able to meet the deadlines except now our only problem is getting him to sign the contract as well. he is very spiteful and we think he won't do it. any suggestions? i was thinking maybe a pay-off for him to do it but i am already broke as it is. please help me with my bleak-looking future.

All you can do is ask. You don't have time to seek legal action at this point. Unless your divorce decree stipulates that he is to refinance the home in his name, you'll have to be the one to take the hit if he doesn't sign the deed over. You may have some recourse after the fact if it does stipulate he'll refinance. You could at least put a copy of that ruling on file with the credit agencies. Unfortunately, you may just have to write this one off as one of those expensive life lessons learned the hard way.

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We bought our home in 2006 with the intent of only keeping it for 3 years and then selling it to buy something bigger. we did a first and a second interest only mortgage and are with b of a but our loan was from bank of ny. due to the drop in the market and the fact that all of the homes around us are going into foreclosure, our house value has dropped down to 192,000 when we owe 232,000 on it. we are looking at needing to keep the house until the market comes back otherwise we would take a pretty big loss if we sold it now. we contacted our current lender about seeing if we could combine both loans into a conventional loan so that we can start paying towards the principal instead of just interest. no luck. even though we have great credit, in short, we are being told that “since you make your payments on-time and are in good standing, there is no motivation for us to help you convert your current mortgage – we will only assist you if you were to no longer be paying on the mortgage”. so let me get this straight – because i can afford my mortgage and because i am in good standing with you and because we (thankfully) have good employment history and are financially stable……you don’t have an interest in helping us stay good customers by restructuring our mortgage so it makes sense? hmmm…that doesn’t seem like it makes sense to me. we have looked at doing a harp loan but because the loan came from bank of ny it is not an fha loan so – that doesn’t help. it’s just frustrating because i feel like we are being penalized for not falling behind on our mortgage because there is no motivation to help us do anything about it since we’re not in jeopardy of losing it at all. granted, i understand it was a risky loan to begin with, so i can’t point the finger at anyone but us, we get that and aren’t disputing that on any level – but there has to be something that we can do, right? since prices are so low right now in our area, we are looking at buying a home for ourselves and then renting our current home out until the market comes back a little, but how does that work? would that let us finally qualify for re-doing the mortgage on our house if it turned into a rental? thanks for your quick responses :) in answer to a couple of the questions - both 1st & 2nd are with b of ny, so they are in the same place so there are not 2 different investors. as for the interest question - the 1st is a low interest rate and the second is a fairly low rate (but obviously a little higher than the 1st since it is in second position). and in answer to anyone's curiosity - yes, i can bite the bullet and say we made a stupid move on this, so i am not trying to point the finger at anyone but us. the truth is, we had made very good, safe moves on our previous homes (at least 10% down, 30 year fixed, principal, interest, mortgage insurance and property taxes) and we decided to be stupid and take a risk thinking we could move in on an interest only, then sell it for a little higher about 3 years later and move into something different. unfortunately, half of america had the same thought we did - and yes, we are part to blame for the situation we are all in. i'm a big en enough to say that yes - we were wrong, now we're just trying to fix it. thanks again for the responses everyone :)

No, investment property is not subject to modification. Ask them to streamline your loan. Same loan, lower interest. I am doing it to mine, one at a time, and it is working like a charm.

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Since the real estate market is not doing so well, houses in my neighborhood has decreased in value because of foreclosures and loss of jobs in the area. my dilemma is we are now upside down on our mortgage. we purchased about two years ago and the appraiser appraised the house at 200k. so that's what we paid the seller. looking at the comps today my house only appraise at 169k a big difference and i'm wondering what can be done about it? we are not in default nor have we lost a job (thank god) however, i think we are being penalized for something we did not do. to sell my house, which i want to do, we would have to come out of pocket almost 40k. i don't know about anyone else, but we can't afford that. any help out there? thanks from mississippi.

Research Short Sales. You will have to short sale the property, the bank eats the loss, not you.

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My husband and i signed up to build a pulte home in chicagoland. we already own a house which we were in the process of selling, we had a contract but no closing had been finalized. this was 4 months ago. we are still not closed on our current house as the buyer us having trouble getting a mortgage. so pulte qualified us with both mortgages and a small down payment. they called a couple of weeks ago to say that mortgage is now no longer available, so they have to switch us to one with a larger down payment, which we can only make if we sell our current house. our closing is approaching and i am now doubting our ability to sell. our mortgage contingency says that we had to secure a mortgage within 30 days, and we went with the builders lender. from my understanding, they approved us, and now can't make good on their offer of approval, so surely we should not be penalized by losing our earnest money if we can't close. does anyone have any advice? are we entitled to our earnest money as pulte can't make good on their original offer which was what led us to being approved in the first place? bobbi we did you a buyers agent, she is the same realtor we are using to sell our house. we did upgrade, but we didn't have to pay anything up front to upgrade, we just had to pay the earnest money. i my mind they have defaulted on their end by approving us unconditionally, and then revoking that and approving us with a contingency. if we can't meet this new contingency then we should get our money back - that is logical to me... but i am not sure about the legality of it all!

Most builder contracts are written to protect the builder. That is because of the long construction times. They need to know that they have a solid "deal" before they spend 7 months building the house. My guess is that they have tied you up in that contract so you have to close or lose your earnest money..

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Here's our situation: we bought our house in 2007 and are looking to sell in the summer of 2011. we've been with bank 1 since 2007. our account was sold last month to bank 2, effective nov. 1. we received our "welcome packet" from them on thursday. we attempted to pay our bill over the phone on monday, only to be told that as it was 4:05, that department closed at 4:00. we then attempted to speak with customer service about setting up an online account. however... 1) they answer their phones as: "the customer service. what's your social security number?" 2) they don't offer online bill paying. interesting...but okay. we paid it today over the phone. the first guy who spoke to couldn't even spell correctly, so we spoke to his manager. not much better. they don't even accept debit or credit cards. you can only pay by check routing number or through western union. i looked these guys up online, and apparently they have a nasty habit of not submitting payments in a timely manner, thus penalizing customers for "late" fees. we're obviously not happy with these guys, but i don't know if it's worth refinancing if we're going to be selling our house in 5-7 months anyway. however, i don't this bank to screw us over. honestly, they are as scammy and sleazy as i've ever seen.

Don't refinance, it will take you years to recoup the costs. Do you have the option to receive a statement in the mail and pay by check? Then you don't have to deal with the customer service department. I have yet to hear of a lending company that would only accept payments via the phone.

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I purchased a new home in june 2006. i was unable to sell the old home and paid double mortgages for 8 months. finally got sick of bleeding and put the house up for rent in july 2007. rent did not cover full amount of mortgage and home equity. i finally sold the house in august 2008. i had a lot more money in the house in improvements than i was able to sell it for. question is: does this qualify as a rental for tax purposes when selling it or as a primary residence? is one better than the other? is this situation going to penalize me when it comes to getting a refund or will it be helpful? i have lost money at every turn and i may lose my mind if i get the short end of the stick on this deal as well. thanks in advance for your help.

If you lived in it the required time it can be tax free sale. The rental income and expenses are used for the rental schedule and you will recapture any depreciation you took or should have taken when computing your profit or loss on sale.

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I took a line of equity from bofa in aug 2007 and house foreclosed in nov 2008. we made payments on the equity line till oct 2008 but when the foreclose proceeding started bofa started penalizing us by adding $500.00 a month to our initial payments of $300 a month. their explanation on penalty "due to foreclosure the penalty is being added" (even though we were never late on our equity payments). we called bofa and spoke with an agent and told them that we are willing to pay of they remove the penalty. per boa " we have put in a request and they will call us back". no one called us back and we stopped making our monthly payments. bofa never followed up and recently a collection agency out of east cost called us to collect the debt of 52k. my initial loan on the house was 505k 80/20 and then the equity line of credit of 55k. the house was sold in an auction after the foreclosure in dec 2008. here are my questions: a: what can the collection agency do to collect the debt? b: can they sue us in east cost and we have to defend ourselves out there? c: can they put a lien on our current property? we are looking forward to hearing form you.

A digression. Going into foreclosure is a breach of the contract, subjecting you to penalties. The fact you were current is irrelevant. A). The collection agency, on behalf of BofA, can recommend filing a lawsuit in superior court (amount owed exceeds $25,000). BofA may or may not sue you. B). They cannot sue you in another state. (You have to be served papers properly, and I don't see how another state will accept proper service has been given, if you live in California.) C). After winning a judgment, they can place liens against everything you own that is not an exempt asset. Exempt assets are assets protected by state law or federal bankrupcty law. California has its own bankrupcty laws, so you'll have to do some research. Playing Dutch Uncle. $55,000 is too much money for BofA to leave on the table. I'd bet my right hand they'll sue you. I would take steps TODAY to convert as much of your non-exempt assets to exempt assets as you possibly can. Work closely with a bankruptcy attorney, and then negotiate with BofA. For example, suppose after converting assets, it's clear to BofA that you have $10,000 of non-exempt assets. Offer $10,000 to settle in full. Be prepared to file for bankruptcy.