Who owns the house after a Chpt 7?

[BCA2009]

Some have successfully negotiated a release of the lien for substantially less than the balance owed and less than the equity available.

OK, I stand corrected. But if that is the route the OP goes, I think he should have that transaction (settelment on the 2nd) nailed down before he re-affirms the first.

[me90210]

I can't understand why you would want to sign a new note on a house you just discharged in BK. Your 2nd is still there and will foreclose eventually if there is any equity to be had. Even if they don't foreclose you could never sell the house without satisfying the 2nd mortgage. The bottom line is if you want to keep the house you will have to pay both notes. Unless you could negotiate a buyout of the second, but you would have to give them at least what they could get thru foreclosure and you would have to pay it in a lump sum. They wouldn't let you make payments on a settlement.

You need to do what you think is in your best interest, but I don't see any upside to re-affirmining a first and not the second. after a chap 7 discharge.

That was the misunderstanding I had. I thought since both were discharged that the 2nd was gone completely, lein and all. But someone else had mentioned that Lein stripping only happens in a Chpt 13, not 7.

So, Im back to where I started (and planned), to give up the house.

No big deal, I thought maybe I could keep the house with only the 1st mortgage.

[Amy26]

And to answer your other question about how to quickly liquidate the house... there is no quick way. You just have to wait for them to foreclose on it. Also, the foreclosure will not show up on your credit because you surrendered the property in your bankruptcy. It will always show on your credit as "IIB". If it does happen to show up as a foreclosure once your bank gets around to it, then you will just need to dispute it.

[me90210]

And to answer your other question about how to quickly liquidate the house... there is no quick way. You just have to wait for them to foreclose on it. Also, the foreclosure will not show up on your credit because you surrendered the property in your bankruptcy. It will always show on your credit as "IIB". If it does happen to show up as a foreclosure once your bank gets around to it, then you will just need to dispute it.

Thanks!

That was going to be my next question, if there were any alternatives to forclosure and how long it would take

I think I may have even extended it by a month or two by talking to Wells Fargo and telling them I might be interested in a modification.

[Amy26]

It could take quite a very long time... I was dicharged in September 09 and stopped paying my mortgage over a year ago and they were still trying to collect from me up till last month. I did receive a letter from them 2 or 3 weeks ago saying they were going to secure the property sinced it was vacant. They have not made any more collection calls to me in a while... so, hopefully I won't have to wait much longer.

[MarieT]

If you want to learn more about home loan modifications go to www.loansafe.com I know there is a lot of info on there about seconds and I have read of people settling their seconds for 10% of what is owed. I found out about this BK forum from someone on the loansafe forum.

I got a permanent signed modification but it took me three applications and about a year to get it and we have had so many other financial setbacks in the meantime that we are now having to do BK.

[pcn]

What's to stop you from contacting the 2nd and asking about a settlement? If you were to offer 10% and they accept, you are still below the value of the home. It doesn't sound like you are 100% sure you want to give it up yet, so why not try calling the 2nd? It doesn't cost anything. I would do it just because now YOU are the one in power and the worst they can say is no. If the answer is no and you walk, they get nothing.

House value $170ish

1st Mortgage - $149
2nd Mortgage - $88 (settle for 9k)

149 + 9 = $158 < $170

[me90210]

What's to stop you from contacting the 2nd and asking about a settlement? If you were to offer 10% and they accept, you are still below the value of the home. It doesn't sound like you are 100% sure you want to give it up yet, so why not try calling the 2nd? It doesn't cost anything. I would do it just because now YOU are the one in power and the worst they can say is no. If the answer is no and you walk, they get nothing.

House value $170ish

1st Mortgage - $149
2nd Mortgage - $88 (settle for 9k)

149 + 9 = $158 < $170

I thought about it. But the $170 is a ballpark figure and could be off. Worse case is I settle for $158 and end up upside down again on the house. In this case I would rather err on the side of "Fresh Start".