Keeping house in Chapter 7

[redtractor404]

My wife and I had our Chap.7 341 mtg. on 12/19 and all went well. We intended to reaffirm our house, and have contacted Chase Home finance several times to get the paperwork, to no avail. Since we have not reaffirmed, but we are continuing to make payments on time, can they evict us? Can we re-finance (we have an FHA loan)? Can we sell the place? We're now leaning toward not reaffirming if there is reasonable hope that Chase won't boot us out. Anyone got advice or experience?

[justbroke]

They can't evict you. If they don't send the re-affirmation and you were doing a re-affirmation through the court, then the debt will be discharged.

You just continue paying them via a process known as a "ride-through". It's kinda-like a "don't ask" / "don't tell" policy.

Once your case closes, you can refinance, burn it down, whatever your want to do... that's legal.

[AngelinaCatHub]

They can't evict you. If they don't send the re-affirmation and you were doing a re-affirmation through the court, then the debt will be discharged.

You just continue paying them via a process known as a "ride-through". It's kinda-like a "don't ask" / "don't tell" policy.

Once your case closes, you can refinance, burn it down, whatever your want to do... that's legal.

Was about to say the same thing. They do not want to be realtors. They will have a flood of homes soon. It certainly will be a buyers market. Don't reaffirm as you never know if you will be one in the unemployment line soon. Things don't seem to be getting better. I sure am pleased I got in when the getting was good. 'Hub

[drowningindebt1]

When is it good to reaffirm, we are also planning on doing a chapter 7. Our first mortgage is with indy mac bank for $191,000 interest only for 10 years and 2nd mortgage was sold to citi and we owe about $42,000, house is only worth approx, $215,000 or less. Should we reaffirm?

[TEW]

When is it good to reaffirm, we are also planning on doing a chapter 7. Our first mortgage is with indy mac bank for $191,000 interest only for 10 years and 2nd mortgage was sold to citi and we owe about $42,000, house is only worth approx, $215,000 or less. Should we reaffirm?

Never

[drowningindebt1]

What if they want to reaffirm and we dont, I guess my question is, is there any positives to reaffirming?

[redtractor404]

Thanks for the advice, as far as paperwork goes, when we talked to our attorney initially, we indicated that we wanted to re-affirm. After much thought and the good advice here, we've left him a message to call us. He has received no paperwork that I know of from Chase. Would there be any additional paperwork that we'd have to sign to reaffirm? The main reason we wanted to reaffirm was the positive effect a mortgage would have on our credit score. Would the effect be worth it? We want to be able to buy again in about 2 years or so... thoughts?

[TEW]

What if they want to reaffirm and we dont, I guess my question is, is there any positives to reaffirming?

None that I can think of. It is not up to them it it your dissension.

[lrprn]

The main reason we wanted to reaffirm was the positive effect a mortgage would have on our credit score. Would the effect be worth it? We want to be able to buy again in about 2 years or so... thoughts?

I hate to be the one to break this to you, but signing a reaffirmation is no guarantee that your lender will report your payments to the credit bureaus after your bk is closed.

Reporting to the CRAs is completely voluntary. We have had members here who reaffirmed but then could not force their lenders to report on-time payments.

One thing you can do is to include language in the reaffirmation agreement that compels the lender to report to the CRAs. However, keep in mind that if you reaffirm, you are making yourself liable to repay the entire mortgage no matter what happens in the future - job loss, medical problems, etc. If the real estate market continues to decline, you could find yourself in a house that you are trapped in because you can't pay off the mortgage if you sell it.

Think long and hard about signing any reaffirmation agreements. Discuss the consequences and get recommendations from your lawyer before doing anything.

[drowningindebt1]

Is there any chances under the reaffirmation that the payment could be lowered or at least get into a fixed mortgage since ours is interest only (7.5 %) for the first 10 years and our 2nd mortgage is 9.5% (45,000)?

[lrprn]

Is there any chances under the reaffirmation that the payment could be lowered or at least get into a fixed mortgage since ours is interest only (7.5 %) for the first 10 years and our 2nd mortgage is 9.5% (45,000)?

If you filed with a lawyer, you can ask him/her to word the reaffirmation agreement to include renegiotating your mortgages' APRs. There's nothing to force Chase to say yes, however. You've already filed bankruptcy. What else could you do to them except walk away and allow them to foreclose?

Lenders don't often agree to things that are against their own self-interests. Since you've already told them you want to reaffirm which implies you can afford the stated payments, what's in it for them to agree to reduce your APRs at this point?