A little advice please

[x23]

So, we filed Chapter 7 and were discharged in Nov 2011. We included our mortgage which is a 1st at 6% and 2nd at 11% with Citi and DID NOT reaffirm. We have continued to pay even though we are upside down by 40K. We don't qualify for a HARP program cause the loan isn't owned by Fannie or Freddie. The mortgage is a 10 year arm which comes due on 2017, so I'm hoping not to be here by then.

I know we can't apply for a loan cause our names are still attached to this property and would get declined....is this correct?

My question is, if we decide to stop paying and let the home go into foreclosure, would we be able to apply for a loan in a year or so and get approved even though the foreclosure was a year ago? Would the foreclosure show up on our credit reports?

I'm asking cause I'm trying to convince my wife that we should rent a house for the next year till the foreclosure goes thru then we can buy a home once our names come of the title.

Would this be a good move?

Any advice is greatly appreciated!

[LadyInTheRed]

If you default on your mortgages and there is a foreclosure, you will have to wait at least two years after the foreclosure is complete and title is out of your name to get a new mortgage. You could continue to live in the house after you stop making payments while you wait for the bank to foreclose. Put what you save on mortgage payments towards the security deposit on a rental and then towards a down payment on a future home.

Is your income high enough to pay a mortgage on a new home and continue to pay the mortgages on your current home? If so, you might be able to qualify for a mortgage on a second home. You could wait until you close on the new home before defaulting on the current mortgages. If your income is not high enough to do that, could you rent the current home for enough to cover the mortgage plus other expenses? That would be another way to qualify for a mortgage on a new home.

[niko]

Foreclosure and Bankruptcy on the Same Mortgage

If a mortgage debt was discharged through a bankruptcy, the bankruptcy waiting periods may be applied if the lender obtains the appropriate documentation to verify that the mortgage obligation was discharged in the bankruptcy. Otherwise, the greater of the applicable bankruptcy or foreclosure waiting periods must be applied.

[niko]

do not give up and read the postings from tobee43 - if you have at least 10% down and 2 years of job history - someone will take care of you.