Mortgage Reaffirmation confusion

[Fletch]

Need opinions..

I filed chapter 7 November 3, had 341 meeting December 2, report of no distribution the same day. On my petition we chose that we would re-affirm our mortgage.

We have always been current on our mortgage and remain that way. I received a re-affirmation agreement for our mortgage last week and my Attorney says we absolutely have to sign it (or move out) however the banks attorney says its voluntary.

Mortgage amt $388k, home value per Zillow 325k, value per town 272K.

If I sign the agreement I doubt the court would approve it.

Wondering if we should just sign it to go thru the motions...Knowing that the court will not approve it and we can just do a ride-through.

I am really disappointed that my attorney is so mis-informed about re-affirmations on Real Estate.

[AngelinaCatHub]

Need opinions..

I filed chapter 7 November 3, had 341 meeting December 2, report of no distribution the same day. On my petition we chose that we would re-affirm our mortgage.

We have always been current on our mortgage and remain that way. I received a re-affirmation agreement for our mortgage last week and my Attorney says we absolutely have to sign it (or move out) however the banks attorney says its voluntary.

Mortgage amt $388k, home value per Zillow 325k, value per town 272K.

If I sign the agreement I doubt the court would approve it.

Wondering if we should just sign it to go thru the motions...Knowing that the court will not approve it and we can just do a ride-through.

I am really disappointed that my attorney is so mis-informed about re-affirmations on Real Estate.

You are gambling and could lose. What if it is approved? You would be stuck unless you rescind within 60 days. I would keep your intentions out in the open and pay through. That is, if the bank allows this in your original paper work. They are likely to allow but you cannot be late on one payment in the future. As of this time, your bk is well on the way to discharge within time. The consensus here is ride through is better for you. 'Hub

[Fletch]

You are gambling and could lose. What if it is approved? You would be stuck unless you rescind within 60 days. I would keep your intentions out in the open and pay through. That is, if the bank allows this in your original paper work. They are likely to allow but you cannot be late on one payment in the future. As of this time, your bk is well on the way to discharge within time. The consensus here is ride through is better for you. 'Hub

Don't they have to go by the normal forclosure laws? Here in Ma after 90 days you receive a NOD

[AngelinaCatHub]

Don't they have to go by the normal forclosure laws? Here in Ma after 90 days you receive a NOD

Yes I'm sure they do. I'm not understanding the question as, if you do not make a pay through payment on time, they then have a right to repo and do not have to accept another payment, then you will lose your house. If you wish to dump it, you can, just stop paying on the pay through then leave it. You won't get sued after they sell it and it will be discharged. If you reaffirm, and cannot pay for any future reason, you will then be sued and cannot discharge that debt. Is this what your concern is, or clarify please? 'Hub

[Fletch]

Yes I'm sure they do. I'm not understanding the question as, if you do not make a pay through payment on time, they then have a right to repo and do not have to accept another payment, then you will lose your house. If you wish to dump it, you can, just stop paying on the pay through then leave it. You won't get sued after they sell it and it will be discharged. If you reaffirm, and cannot pay for any future reason, you will then be sued and cannot discharge that debt. Is this what your concern is, or clarify please? 'Hub

Actually I want to keep the home and pay through. I just dont think I should re-affirm due to the fact the home has dropped in value so much. What my attorney said had me concerned (him stating we would have to move out) especially seeing we are current with the payments.

My thoughts were to sign the agreement knowing the court would reject it due to our negative amount on schedule J and the amount we are underwater. By signing we made an attempt to re-affirm.

[BrokeinMD]

Did you ask your attorney his/her rationale for wanting you to re-affirm it when it's under water? If the Bank says it's voluntary, well, to me, that sounds like a little trick they're trying to do to get you to re-affirm in a nice way and then screw you if post BK you have a problem paying it.

[Fletch]

Did you ask your attorney his/her rationale for wanting you to re-affirm it when it's under water? If the Bank says it's voluntary, well, to me, that sounds like a little trick they're trying to do to get you to re-affirm in a nice way and then screw you if post BK you have a problem paying it.

Actually I did and he said if we dont re-affirm we have to give back the collateral to the bank.. I told him I would call the bank and see if they wanted to re-negotiate the terms of the mortgage (principle) and their attorney said that they do not do that at this time. I also asked their attorney if anything would happen if I did not reaffirm and they said nothing would happen.

This new fear of not re-aafirming is based on what my attorney said to me regarding moving out immediately if we do not re-affirm. Why would I move out if I am current and wish to continue making payments??

[BrokeinMD]

If you're comfortable with posting the name of the bank you're dealing with, maybe others will be able to offer you their experience with it. It's hard to tell you an opinion or share experience, because each bank is different.

[Fletch]

If you're comfortable with posting the name of the bank you're dealing with, maybe others will be able to offer you their experience with it. It's hard to tell you an opinion or share experience, because each bank is different.

Nationstar mortgage

[BrokeinMD]

I never heard of the bank, and your attorney's advice is odd to me. It's my understanding that if you sign a re-affirm agreement for anything, it has to be approved in the Bankruptcy Court by the judge. If you're in the red, the judge will most likely deny the re-affirmation, and the debt will still be discharged. You should still be able to stay and pay. Can any of you vets confirm?

[tcreegan]

Hi Fletch,

I think your attorney advice is a case of theory vs practice. Attorney = theory Bank = practice I'd go with the bank.

Tom in Colo

[Fletch]

Hi Fletch,

I think your attorney advice is a case of theory vs practice. Attorney = theory Bank = practice I'd go with the bank.

Tom in Colo

Thanks Tom.

Going with what the bank says. Also as far as any thing I have read as long as I am current they cannot forclose on me if I do not reaffirm. I think my attorney is mixed up with personal property.

[mike22]

If I were in your spot there is no way that I would sign the re-affirmation. Like HUB said earlier, what happens if it is approved and later you have no protection. You are current on your payment and you plan to stay that way so you are in good shape.
If things go wrong as they can you still have the protection that your BK offers. Your home is upside down and will likely be that way for a decent period of time. Enjoy your home, pay it off or sell it when the maket returns or if things get tough again you always have the option of leaving. This is my 2 cents and each case is different.

I will be interested to see what others have to say and what happens in your case. I met with four attorneys none of them told me that I had to reaffirm. I think that the one exception that would make sense to me would be if there was a significant change in term, rate, principle etc, then it may be worth it. Again just my thoughts.

Good luck.