I'm current on my 1st mortgage, and late on second. My lender came at me with a settlement offer on my second, and keep the the house and fo...

Question

I'm current on my 1st mortgage, and late on second. My lender came at me with a settlement offer on my second, and keep the the house and forgive the remaining of the balance on second loan. What docs should I ask for to make sure this is all true? Deed, etc.

Answer

Rather than asking for documents, it seems to me it would be worth while to run all this by a competent real-estate attorney in your neighborhood. It might cost you the equivalent of a month's payment or so to have good advice. Assuming the second is a standard note and deed of trust, you should be looking for a full reconveyance from the trustee, surrender of the note, and something in writing explaining the deal and signed by the lender; I'd be cautious about any rights the lender retains and in particular I'd look for whatever the lender is getting in return for making what sounds on its face to be too generous to be completely true.