Need Citi advice

[Lana]

I filed last Friday. Included my first and my HELOC with Citi.
I want to keep the house...but only if I can ditch the second.
I'm 11k behind on first. HELOC I havent paid forever and don't plan to. They have been okay to settle for 10% several times now. I never paid. First time cause I didnt have the money by the time they got back to me, second because my lawyer advised against it.

Upon filing my attorney said - the first will file a stay of execution no matter what..so if you want to pay them, you may be wasting your money cause they'll foreclose anyway.

The first called me two days after filing. They want to know what I want to do. I told them I will bring them current and just keep the mortgage. "bless your heart sweetheart!" was the answer. They're not gonna do anything.

Should I bring my first current and take my chances with the second later?

[jjsmith]

What's your equity in the house? If you don't have any equity, you can strip you 2nd mortgage with a Chapter 13.

Is your first with Citi too? I can tell you what Citi did in my situation. We had a home that we couldn't sell before moving, so we rented it out thinking the market would improve in a year or so. Yeah right!! When things got worse in the economy, we decided we needed to try to modify our 2nd mortgage with Citi. We owed $200K on the first with Countrywide and $170K on the 2nd with Citi. We were losing $1300/mo. renting this house out and couldn't afford to do that for very long. We contacted Citi and told them the situation and suggested a loan modification to 4% interest and an interest only payment, which would mean we would only lose $200/mo. and we could sustain that indefinitely. They rejected our offer and asked me to short sell the property. I told them that the property was only worth about $250K and they would only get about $30K. They said that was the only option. I then asked if they would consider a settlement. They said I could make an offer. At this point, our financial situation wasn't nearly as bad and I was interested in paying off as much of my debt that I owed as I could. So, I figured with my lines of credit I could come up with $75K. I offered this and they countered at $100K. They refused to take less. After I was 5 months behind they called and made a pathetic attempt to modify my loan and roll my late payments and fees into the balance. The person on the phone admitted flat out that they would not foreclose on the property, because they would have to come up with the money to pay the first. And obviously this wouldn't make sense with a declining market. After 6 months of no payments, my loan was transferred to an attorney to administer and foreclose. I got 1, only 1 letter from the attorney and never heard a thing from Citi or the attorney for another 10 months. No phone calls, nothing!!! When we finally had a short sale offer, we submitted it to the attorney and they quickly accepted their $30K. And we wonder why our country is in a financial crisis??

So, I can tell you that if there is no equity in your property, it would be VERY unlikely for Citi to foreclose and pay off your first. But, it seems like it would be very unsettling always wondering what was going to happen. I'm amazed at your ability to get 10% from them. Sounds like a pretty good deal to me, if you want to be guaranteed to keep your house.

It sure seems like your attorney should be able to step in and negotiate with your 1st mortgage to accept the payment and not foreclose if you reaffirm the debt. But that doesn't help if the 2nd forecloses years down the road when property values get better, so it would be best to get both addressed in the bankruptcy.

[Lana]

Well I filed them both in ch 7. The second wont talk to me now unless I want to bring them current - no thanks. The first though is more than happy to take money to bring current.
I owe the first like 11 and then I'm current. The payment is no longer a problem since I've alleviated my other debt. I guess the only chance I take is that if I bring the first current and then after the discharge the second wont settle, Ive basically thrown away 11k.
The second is 60 of all negative equity. Id rather walk.
However I do believe they would settle. If they were going to do it twice before I dont see what would be different two months from now.
I suppose if they wont, I will walk, but meanwhile I suppose I would be "renting" my house with no worries about ending up in the street. The second would never foreclose unless they had some equity, and they'd be waiting a long time for that to happen.