Zombie mortgages poppin out and showin niggas.......
Many so-called zombie mortgages date back to the 2008 financial crisis, and consumer advocates warn a new wave of zombies could be on the horizon — this time, from all the home equity credit lines taken out during the pandemic.
www.yahoo.com
Jose Arzate once dreamed of a peaceful retirement in a quiet neighborhood in his hometown. A 24-year veteran of the county probation office, Arzate thought he had achieved the American Dream when he purchased a three-bedroom ranch house in Santa Maria, California, 20 years ago.
"As an immigrant, you have a dream, a dream of owning your own home. It's your castle. It's for your family," said Arzate.
The son of Mexican immigrants, Arzate envisioned the family home would be passed on for generations. But while he thought he was building a future for his family through equity in his home, a hidden financial nightmare was eating away at his dream.
"I woke up one morning to find sheriffs outside my door," Arzate said. "I had no idea this was coming. I was in bed, starting my day, and suddenly, I was being evicted."
What Arzate was dealing with was a zombie mortgage.
Arzate had modified his loan 13 years earlier, taking out a second mortgage to manage expenses. He assumed his monthly payments covered both mortgages. Unknown to him, he says, the second mortgage had been sold to a different servicer. Arzate said he never got a separate monthly statement for that second mortgage until it was too late.
"I didn't get a bill at all," he said.
More than a decade later, that unpaid loan was resurrected with interest and late fees, inflating the debt from $65,526 to $139,211.
Federal law mandates lenders send statements for home loans, but some don't comply.
Arzate said he was told he needed to pay the lump sum or leave.
"If you owe money on a credit card, they send you a bill every month," Arzate said. "They didn't do that. They just evicted me."
