Some questions about 2nd and chapter 7

[tacomatom]

Our BK just became final on the 8th. We did not re-affirm on either of our 2 loans. We have been just barely making ends meat and now our 2nd just adjusted up another $200 a month. ( We had gotten a loan mod to lower our payments for a while) We tried to get them to mod again but they only wanted to do another short term mod. My income is not gonna change and i dont want to keep doing this.

Here is the details on our house

1st owe 160,000
2nd owe 40,000

our house is worth maybe 160-170 in our market. It also needs alot of work.

Neither mortgage company will modify us now as they say i make too much money according to the government standards. ( I make about $4000 a month gross, Net is about $3200 or so give or take some OT)

We have been staying current on or payments but just barely and our groceries are whats suffering. Now with it being $200 more what are we supposed to do?

If we stop making the payments will that make them want to think about a mod a little more?

I also heard that in washington state if you file Chapter 7 and dont re-affirm you have like a year to still give up the house. If we did that how will that affect our credit as far as getting another loan in the future. Will it be worse than just a plain BK?


Sorry for the long post, if you made it all the way down here i appriciate it lol

[IBroke]

I also heard that in washington state if you file Chapter 7 and dont re-affirm you have like a year to still give up the house. If we did that how will that affect our credit as far as getting another loan in the future. Will it be worse than just a plain BK?

I might be able to answer that:

Since you included the mortgages in your cH7, they won't be reported to the credit reporting agencies after the date of filing (they still show up, but they aren't updated). So in that regards, you won't get any additional derogatory information reported since you don't owe anything on the mortgages. Sure, they are still secured by the property but they can't sue you for anything.

Your payments aren't reported, either.

As long as you keep up with your payments, you can keep the house. Once it gets too much, you can simply walk away. That's because you discharged and DIDN'T reaffirm the debt.

[destitute]

I don't know about the washington law you refer to but your debts have been discharged. No matter what happens with the house they cannot report it to your credit.

You may want to consider stopping payments on the 2nd for a few months but keep that money in the bank. Then try to get the second to settle for maybe 10-15% in exchange for releasing the lien. There are others on the board trying the same thing. If they say no and you want to you can always bring the account current. They can't report late payments so there's little risk to you in this scenario. Just make sure it doesn't get to the point where they accelerate your loan or you may not have the option of becoming current.