I have run up against a problem recently with the 2nd lien holders requiring additional funds to release the 2nd.


This is a relatively new problem for me because we have been able to satisfy them, for the most part, with the amount that the first was willing to give them.


Even if they wouldn't waive their right to come after them for the balance, they would at least release the lien so that it could be sold.


The biggest problem that I am having with it is that the first will not agree to the buyer paying the additional fees.  I would really appreciate it if anyone who has had a similar situation and found the remedy could share their experience.

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I've had this problem lately as well. In one case the Buyer came up with the extra money and in another the Seller did. HELOCs are particularly difficult.
I have a similar situation right now. The 1st agreed to pay 3% CC. The Buyers are willing to pay all the closing costs to satisfy the 2nd. I haven't told either lender where the money is coming from. I figured - why should they care?
Jan, How are you submitting the hud1 to pay the 2nd the required amount to release the lien? Are you listing it as a buyer's expense? If so, what are you calling it?

Just now, Chase, said that they will not release the lien on another property that I have unless they receive 10% of the loan amount.

This is becoming more and more of a problem and I don't see it going away. I am afraid that they will get more agressive. I want to find a way to deal with this besides passing on the fees to the buyer. In some cases, they will pay it, but if it is too much, they will not.

Right now, I would be happy with finding solution to getting the first to agree to let the buyer pay more to the 2nd.
Julie, my first HUD gives $1,000 to the 2nd from the 1st. The 2nd - Flagstar wants more. So far we have not agreed to anything. When we do, I will just remove "seller credit to buyer closing costs" from the revised HUD.

Yes, they wanted 10% also, then mid-negotiations, they re-vamped their process from working with one negotiator to submitting requests to a pool of underwriters.

If it's a Fannie or Freddie, can you mention the 2MP? The first will have to give the 2nd $3,000 and no more.
I am having a problem with Chase. They are the 1st and 2nd and thankfully the only lien holders. The 2nd had approved for the seller to come to the table with 400.00. Now, a new buyer, the 2nd wants 7k from the seller. What in the heck happened? Let the 1st know about it and he is supposed to be 'working magic", we'll see. Naturally, the 2nd is a HELOC
Chase is one of the lenders that I am dealing with as a 2nd and I was told in more than one transaction, by the negotiator that they would need 10% of the balance to release the lien.

I know that the investor on each loan varies, however, Chase is one of the servicers that is asking me for more money on every transaction.

Thank you, Jan, for your response. I actually love being in real estate today, even though it is 10 x the work for less pay, because I like helping people. However, I do get tired of dealing with greedy investors. I think that they have all had more help than the average homeowner is getting...



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