Ch. 7: Mortgage not reaffirmed - how to later buy?

[REdebtor]

Hello all,

Approximately 1.5 years ago we purchaed a home. We filed Ch. 7 a few months ago & did not reaffirm our mortgages (doing a ride through). We are ~ $75k underwater on our home.

I understand from this forum it may take 2+ years for our credit to be good enough to purchase another home. At that time, if prices are even lower, it would make sense for us to abandon our current home & buy a new one.

Would any lender lend to us under such a situation? On the mortgage application I'm sure we would have to disclose that we continued to live in our BK home & made payments. In buying a new home, we are basically walking away from this home for a lower priced home. Is that possible or will it make a lender too nervous?

Thoughts?
Thanks!

[HHM]

By that time, enough distance has passed between your BK and your proposed foreclosure that the two events are separate such that you will have a VERY DIFFICULT time finding financing because of the foreclosure.

[REdebtor]

Thanks HHM. That is what I feared. Guess it makes sense to let the house go at some point in the near future. Hate to move yet again - but it is probably for the best in the long term.

[InSeriousDebt77]

Sorry for the late post...but I thought that when you don't reaffirm a house, the mortgage will appear on your credit as IIB with a zero balance (or similar). And if you chose to walk-away at a later date, that mortgage will still be reported as IIB (the creditor couldn't report it as a foreclosure at that point).

Or is it more of a situation where the lender will regard them as two separate events?

Thanks

[stephanie4686]

I am curious too. I have been paying my mortgage, but they have not reported anything since the day that I filed, and I am discharged now.