PMI and Homeowners after Chapter 7

[learnmore]

When I file Ch 7, I will request to reaffirm my mortgage... however, I have read here that the lender will not always agree to the reaffirmation, so it has me thinking:

If I don't reaffirm, but continuing making payments what LEGAL agreement do I have with the lender, especially regarding PMI and Homeowners insurance?

For example, right after my discharge I would like to pay down my mortgage to %80 so as to eliminate the monthly PMI premium.... how do I know they will honor the agreement I have with them now that PMI will be dropped at %80?

And furthermore, what if I choose not to insure or to under-insure my home (which makes since if I'm not legally obligated to the debt and willing to risk the equity) ...will they go out and buy top-shelf insurance and then charge me interest on the expense indefinitely?

I really don't like the idea of having a quasi-agreement. I want everything in writing. Without a reaffirmation, it seems they could just take my money month after month and apply it to any made-up charges they create, keeping the principle unchanged-- and I would have no legal recourse!

[gophermn]

Depends who you are dealing with right? If it's a small town credit union vs a large mortgage buyer like HomeComings or Countrywide - you know where I am going with this.

I asked my mortager to submit a reaffirmation agremment to my BK attny and the courts and to my luck I saw absolutely nothing. Basically they wanted pymts and care less about customer service. How can you blame them the way the market has been.

Nonetheless to answer your question I think you indeed need it in writing but can it be done before banging your head against the wall? I would try to just target one person (if its a big company) and work with him/her only him/her. You might have to fish a bit to find someone who might be able to draft a letter.

Overall I am not sure everyone in here will say they "will not reaffirm". In todays market I am betting they will be more than happy to work with you - and if the price of a letter will cost them another foreclosure then so be it. Their loss.

Good luck

[gymbo]

Hello,
I'm not an expert in BK issues (yet) but I can tell you the company that when my home mortgage company did not receive my confirmation of insurance last year, (even though I faxed it 4 times from 3 places) they purchased insurace for us at 10 times the regular cost and billed our escrow. (We eventually cleared it up and they apologized).
Pay your insurance if you have a mortgage, whether you file BK or not. trust me.