Please help..Mortgage Question!

[Logan]

How much equity do you have? If you're upside down you've got HSBC by the balls. They don't want to foreclose and have to buy out the first. If there is plenty of equity then they've got you buy the balls....

[rrockinggramma]

To Rick in Mich, HFC will be ok if you don't reaffirm. We didn't reaffirm with them. Then when we walked away, they were second in line and had to settle with the 1st for a slice of the pie. They can be difficult to work with cause they have been burned a lot in the past with their high interest rates and equity loans that the balance never goes down. I would not reaffirm with them and I didn't reaffirm with them. If you are keeping the house, just make your payments.

[pa308]

Hello,

My est market value 100 k. 1st with coldwell banker 75k. 2nd with Citizens bank 10k. So I have about 15k in equity which is exempt. I want to keep my house and planned on re-affirming both. What are the benefits/disadvantages of doing so or not. HHM said to never reaffirm a second and i dont understand why. Has anyone had any experince with these two lenders on whether they re-affirm or not? I believe in the Citizens loan papers that bk is default, will they try to foreclose on me??

[needafreshstart]

To pa308, I would disagree with HHM on never reaffirming a 2nd mortgage. A situation like yours if you really want to keep your house, there is nothing wrong with reaffirming. But you have to be aware of the ramifications of reaffirming, ie you are resonsible for those debts.

[rrockinggramma]

just my 2 cents. . . I would never reaffirm anything. And this is why. Life is full of twists and turns and you never know what lies ahead. In the future, should anything bad happen or your financial situation not really improve after your chapter 7 because you are overextended on your house etc, then you can walk away and there would be no repercussions or deficiency balances to pay. Reaffirmation makes you "resign" for the debt and it is like your BK never took place. Now many will say that the key is to have your "on time payments" reported to the credit bureau. I have been around on these boards a long time and if you search, you will discover lots of posts about credit bureau's that don't report those on time payments even WITH reaffirmation agreements. With a mortgage, your on time payments are with the lender. Anytime you refinance it or buy another etc, a mortgage history is obtained. All those on time payments are right there for the new lender to see. Again, I would never reaffirm anything.

[drummer1]

IN Our case we are indeed upside down, we owe a total of about $275K And the house is now valued at $207K..The market in our area took a huge nose dive..Our first is with Wells Fargo and as I said earlier the second is with HSBC..They are really intense about getting us to sign a re -affirmation! My laywer agrees with everyone here and said in no way will she let us sign that..she just keeps blowing them off..

It was a tempting thought even if for only a brief moment of fantasy...to think of not paying that second...However of course we will continue to pay it each month because we do need our home..But we will not re affirm it!


On another note, I have decided once the discharge date comes, I am going to turn in My truck..they did not want to reaffirm either....I dont want to make payments for that another 4 years, hopefully its as simple as driving it to the bank and handing over the keys....that extra money is going to help, I am just going to buy a junker to get around town..

[ssdsco]

just my 2 cents. . . I would never reaffirm anything. And this is why. Life is full of twists and turns and you never know what lies ahead. In the future, should anything bad happen or your financial situation not really improve after your chapter 7 because you are overextended on your house etc, then you can walk away and there would be no repercussions or deficiency balances to pay. Reaffirmation makes you "resign" for the debt and it is like your BK never took place. Now many will say that the key is to have your "on time payments" reported to the credit bureau. I have been around on these boards a long time and if you search, you will discover lots of posts about credit bureau's that don't report those on time payments even WITH reaffirmation agreements. With a mortgage, your on time payments are with the lender. Anytime you refinance it or buy another etc, a mortgage history is obtained. All those on time payments are right there for the new lender to see. Again, I would never reaffirm anything.

Ditto ! The benefits of not reaffirming far out weigh the benefits of reaffirming. At least from what I've read.

[pa308]

Confused. And if i dont reaffirm can they foreclose. Bottom line is I do not want to lose my house and this reaffirm/not reaffirm is very confusing.

[lrprn]

Confused. And if i dont reaffirm can they foreclose. Bottom line is I do not want to lose my house and this reaffirm/not reaffirm is very confusing.

Pa, you need to get sound legal advice from lawyers familiar with how the mortgage and vehicle lenders are reacting to not reaffirming loans in your area. None of us here know absolutely whether your home is at risk or not.

In some states, state law declares as long as you make on-time payments, creditors CANNOT foreclose on a home or repossess vehicles. In those states, it's absolutely safe to not reaffirm. Ours is one of those states, so on the advice of our lawyer, we did not reaffirm either of our mortgages or either of our cars.

In other states that don't have that state-based protection, filers are finding that as long as you continue to make payments on time, creditors are not willing to foreclose or repossess after discharge. Creditors have to pay to seize your property and auction it. Unless your asset is has considerable equity (ie a car is worth far more than you owe on it), creditors make significantly more money by allowing you to continue on-time payments. Let's face it....creditors are all about making money!

This is why although the current bk law states that assets with loans must be surrendered, redeemed, or reaffirmed, in practice, it just isn't happening in most locations.