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Foreclosure/Possible Private Mortgage Foreclosure

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Question
Hi James,
First of all, thank you for making your time and expertise available through this site.  I volunteer as an expert in another category, and I find it to be a rewarding experience.

Here is my situation.  I own a rental property and the mortgage is held through a private investor.  This investor is a part owner of a company where I worked for over 20 yrs.  I moved on to a better opportunity a couple years ago, but the mortgage agreement has not changed.  I make my monthly mortgage payments, although sometimes late.  I have never been given a bill for late fees; and when I hand deliver the payments, no additional fees are requested at that time either.  The mortgage is principal and interest only - I am responsible for taxes and insurance on my own.

I received a call from the lenders' daughter (aka his lawyer) last March complaining that I had not paid the property taxes yet.  I was surprised by this call because I have NEVER paid the property taxes when the bill first came due.  The bill comes out in July, and can be paid up until the end of September with no interest.  On October 1st, the county deems the taxes delinquent and begins to add monthly interest fees until they post for a tax sale that occurs the following June.

I own two other rental properties with similar situations, and I have always made my tax payment prior to the properties going to a tax sale - often before they are even announced in the local paper for pending sale.  I think this particular lender is lashing out because I no longer work for his company because this had never been an issue in the previous 8 or so years that I've owned the property.

Fast forward to this year - and I just received a letter from another lawyer telling me I had 5 days to address this years tax bill or my lender would start foreclosure proceedings.  The letter was dated 1/21/14, but I just opened it today.  The letter states that I have been making my monthly payments, but acknowledges that they are late.  

Here are my questions:
1) Are late (but paid) mortgage payments grounds for foreclosure?  Again - I have never received written notification of late charges due, nor does the letter state any are owed.

2) Is a late tax bill grounds for foreclosure?  I was unaware that someone could foreclose on a property on the grounds that I owed someone else.

Thank you in advance for any information you could provide regarding this issue.  I am certainly not trying to get out of paying what I owe - but I also don't want to be bullied by a former employer who is not happy that I am no longer with his company.

Thanks again,
Scott

PS - all parties & property involved are located in Maryland.

Answer
Unless your mortgage states the act of being late in itself is grounds for a foreclosure action then you are okay as long as you are now current. A late and unpaid tax bill would be grounds for a foreclosure in that it creates a debt that would have to be paid by the seller if not by you, however once the tax debt is paid it simultaneously eliminates the need to foreclosure. I would carefully read the mortgage so that you will know for sure. Let me know if I can help any further.

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James D. Clardy

Expertise

I have spent the last twenty-five years saving homes from foreclosure in South Carolina. I have extensive experience negotiating with lenders. I have postponed foreclosures for up to four years before the lender finally gave in and let my client keep her home "This is my specialty". One should never give up, even if you think it’s impossible. I know the ropes and can slug it out with the best of them. I can answer questions about what “to do” and what “not to do” during the foreclosure process as well as the pre-foreclosure and post-foreclosure process.

Experience

Twenty-five years of stopping foreclosures in South Carolina, to include properties both listed by Realtors and those owned by banks. Foreclosure properties to include pre-foreclosure and post-foreclosure , and what to do next.

Organizations
I was a Real Estate Broker in South Carolina for the past twenty-seven years.

Publications
I have written several articals on E-How

Education/Credentials
Some college

Past/Present Clients
Thousands over the last twenty seven years

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