Mortgage Question

[Freddy03]

Does anyone know if you are less than 30 days late on your mortgage but filed Ch 7 will they (Wells Fargo) start the foreclosure process? Granted I'm about $100K underwater.

Because it looks like if we file 11/5 our Nov payment (due 11/12) won't be paid until 12/03?

Same thing with the car would it be ok to be 2 weeks late?

[ccsjoe]

Freddy,

Nobody will start a foreclosure process until you receive a Notice of Default. These are typically sent out at 90 days past due.

[Freddy03]

ok just making sure - what do you think about the car? If I'm late 10 or so days will they want to come get it since I filed Ch 7?

[ccsjoe]

Nobody will come get your car for 10 days. Heck, even you car loan bill says $100 due by 8/15, please pay 106 if after 8/25. This is a grace period....you're fine, stop stressing!!

[Freddy03]

Thanks Joe - I tend to stress about this way too much.....lol

[tcreegan]

Hi Freddy03,

Being 100K underwater, the house should be going away in the BK, right? So you can stop paying on it immediately. Most folks live in their surrendered home for 6 months on the short end and over 2 years on the long end, saving the mortgage payment to get their new living situation up and running.

The car might/might not be going away; depends of the loan terms and the equity in the car. A fresh loan, way upside down, mediocre interest rate; on a gas guzzler..time to dump that sucker. Drive a payment free car while the lender has to motion for relief of stay, get it granted, and they jump through whatever hoops the state has set for them. Save the car payments and put it down on a low-mileage used car w. great gas economy.

Folks on the forum who have followed this path seem to be very happy and sing high praise....
Folks who try to stay in underwater homes seem to crawl out later singing songs of regret....

Long answer to your short question, sorry

Tom in Colo

[Freddy03]

Thanks Tom - but even though my house is underwater I need to keep it and stay where I'm at (location purposes). I will not reaffirm the house so if the payments become something I can't manage then I will walk away. I have checked rental houses in my area they are about the same price as my mortgage so moving out is not an option right now.

For the car - I will reaffirm it. I have about 40 payments left and it's worth about 1k less than I owe. It's a good car (gas and maitenance). My hubby has an older car that we would need to replace in a few years.

I was just concerned about being up to 2 weeks late at filing time if that mattered any.

[tcreegan]

Hello again Freddy03,

Not reaffirming the mortgage is a very smart move, when the winds of tomorrow shift you don't have an anchor around your neck!!

Along the same lines, why reaffirm the car loan? Stay current, keep insurance on it, keep the car, no problems. Same scenario, if things go south later, you aren't chained to the vehicle.

One thing to watch for, some lenders will cut off online access and stop sending statements when they get notified of the BK. You have to be the one to initiate contact with them, request online access again, request statements again, is there a different address to send the payments to, whatever. Some lenders do nothing and you just keep paying online or by statement or however you were doing it. Lender never says a peep, business as usual. Do a quick search of your auto loan lenders name on the forum and see what comes up....

Hang in there,

Tom in Colo

[Freddy03]

Thanks
I thought I read on here that Mazda American Credit would be quick to pick up the car if it wasn't reaffirmed?