Comments on: Chapter 7 Debtor Did Not Reaffirm Mortgage – Is Her Home Now at Risk?

By: Jonathan

Jonathan — Mon, 16 Jan 2012 23:58:22 +0000

Erin, the questions you are asking calls for legal advice and access to the modification paperwork. I suspect that if you sign a modification, you would be indebting yourself personally as well as subjecting your property to a mortgage lien. You need to seek counsel from either your bankruptcy lawyer, a real estate lawyer or both. Good luck.

By: Jonathan

Jonathan — Mon, 16 Jan 2012 22:46:44 +0000

Chad, the only way to know for sure if you are still the title owner is to run a title search. There are services that will do this task for around $250 or so. If you are still the title owner, and you stop paying, I think that you would not be liable for any money but if the lender then forecloses, you will have to wait the 3 years to qualify for an FHA guarantee. Perhaps you could talk to the bank about accepting a deed in lieu of foreclosure and thus walk away cleanly.

By: Chad

Chad — Thu, 12 Jan 2012 22:31:39 +0000

My bankruptcy was discharged almost 2 years ago. I did not reaffirm my mortgage but have continued to pay it and have never been late on any of its payments. My credit report shows that I do not have a mortgage at all at this point. I want to buy a different house once my bankruptcy is 2 years old. I know depending on my credit score that I may qualify for an FHA loan at that time. My question is when filling out paperwork for a new loan at this time am I renting or do I still own a home? We are at least 10K upside-down on the property so I plan on letting it go and facing forclosure but I would like this to happen after we are already into a different home. I know once I stop paying and the forclosure happens I would have to wait an additional 3 years to qualify for an FHA loan. I am hoping our loan will already be done before the forclosure takes place and therefor our ability to buy a home will not be affected. Any and all input is welcome.

By: Bryan

Bryan — Wed, 04 Jan 2012 19:59:35 +0000

@Sue: I am in exactly the same situation as you. Have you learned anything new since the posting of your comment on April 26, 2011 ? I am inclined to not sign a reaffirmation agreement as a part of my bankruptcy.

By: Erin

Erin — Mon, 02 Jan 2012 14:43:33 +0000

My husband and I are currently waiting for our Chapter 7 Bankruptcy to be discharged. I guess it will take place in the next few weeks. We did not pay our mortgage for Nov and Dec and do not plan to pay it this month either. We are trying to modify it. If it gets modified will that automatically reaffirm our loan and if so will it reaffirm both the 1st and the 2nd? We are currently $123,000 upside down on our mortgage, however are only $31,000 of that is on the first mortgage…..should we stop paying the second all together and hope to settle for pennies on the dollar later down the road and what should we do with the first? Is it ridiculous to ask the first mortgage to modify our mortgage to the currant value at the current rate for the remainder of the loan? They certainly would make more money from us if they did that than if the foreclose, but is that a realistic scenario? We really do want to stay in our home but it is already at least $123,000 underwater and is in need of many very expensive repairs. We are in MA.

By: Jennifer

Jennifer — Sun, 02 Oct 2011 23:37:13 +0000

Ok, just trying to get something straight… If I do not my mortgage, I can continue to live in my house and pay as usual OR I can simply walk away from the property and move somewhere else? (this is important for me to know as I had around $20,000 of negative equity in the home at the time of discharge)

By: tonya

tonya — Sun, 25 Sep 2011 12:37:44 +0000

I filed bankruptcy in 2009 and was hoping to keep my house. I did not reaffirm however due to the economy and being a divorce single mom, I am unable to keep up with the payments or even sell because of the loss of value in my subdivision. My house is worth 100000 less than what is owed. I’ve talked with my bank, to no avail and finally stopped paying on it to survive. I checked my credit report and now Expeian is reporting me late. My bankruptcy lawyer said that since I didn’t reaffirm they are not legally allowed to report negative credit on the mortgage. I contacted Experian and they said they were in their rights. If I walk away from this home, will it make me start over again and look even worse for a credit history? I have a career in education, I just couldn’t afford my home that was purchased with 2 incomes, not just mine. I’d like to find a home more affordale.

By: Linda Nickerson

Linda Nickerson — Sun, 18 Sep 2011 20:08:40 +0000

I went for my debtors hearing on Aug 24, 2011. I think its either 60 or 90 days until final?
Neither of my mortage companies have sent my attorneys reaffirmation letters. My first is Chase and the second is a line of credit on my home with BofA.
My question is my monthly maintenance. They just sent me a letter with a whole bunch of late fees and now attorneys fees. I had just sent in one of the 3 payments I am behind. I will be caught up with my payments by the end of the month. Can they charge me all those late fees. They are not listed on my paperwork for the BK.
Linda

By: Patty

Patty — Fri, 16 Sep 2011 09:03:11 +0000

I fill BK7 10/2010 pro per because of mortgage and sickness. I was discharged in March of this year and did not reaffirm my home loan with B of A. But I did get a HAMP modification in January 2011 from them after trying for a year filling sure made a difference. I made three trail payment starting 2/1/2011 the last one in May and stop paying then. I heard nothing from them until today 9/15 when FEDEX delivered a permanent modification package. The terms where a change to a fix rate loan and all arrears for tax and interest ($8k) to be paid at the end of the loan in 2034. The new mod also has the HAMP Modification of Loans with Principal Reduction Alternative for timely payment. My reduction is over $10.8k per year for the next three years. As long as I don’t default on more the two payment over that time. My concern are does signing this mean I am now reaffirming the debt and can be held liable for the debt? Two they state if we do get the PRA then it will be report on a 1099c for each year. Does mean in the second and third year I might face a tax problem after the Mortgage Forgiveness Debt Relief Act expires in 2012. I really might do this but not if it put me back on the hook for the mortgage debt. Is it’s just a change in terms of the discharged loan or will signing this mean a reaffirm of loan. I reside in CA my home loan is $225k, after the PRA it would be $194k. My zillow value is around $120k and it will probably take at least 10 years before I see any equity gain.

By: Crystal

Crystal — Tue, 13 Sep 2011 03:05:36 +0000

I seem to be reading so many stories just like mine which makes me not feel so bad.
October of 2010 I filed bankruptcy in Atlanta where I live and it was discharged February 2011 and of course my mortgage did not get reaffirmed. I found this out while trying to buy a car in April of 2011. I’m tired of fighting with the mortgage company and the only option I have is to repay my lawyer a fee to reopen the case. I don’t feel I should be paying for anything else and don’t plan on doing so. I’m curious to know will I still receive credit at income tax time? Also, since it shows the house as being part of the bankruptcy if I choose to walk away in a year or so can with no liabilty? I did a remodification on my house actually right before my banktuptcy which lowered my payments but I will have a ballon note in about 23years. I’m starting to wonder if I should just sit still rebuild my credit in other ways then rebuy in a few years. My concern like I said is tax credit while I’m still here and making sure they can’t come after my when I do leave or sell.