Mortgage reaffirmation

[ullysses]

Many fine answers here and maybe one for me!

I live in Michigan

I have a $95,000 mortgage that is underwater by about $30,000.
Wife and I are in our mid 50's
We plan to stay in the house until we pass

We are going into chapter 7 today and assume our mortgage holder (Indy Mac) will ask us to reaffirm. After the C7 we will have no problem making the payment. For peace of mind issues I would lean toward reaffirming as it would seem to be a more stable situation.

Could I use the possibility of reaffirming to ask for a lower interest rate or principle reduction?

Would anybody give me a little direction in this area? My head is still reeling at this moment and my decision making abilities are a bit clouded by the magnitude of the whole process.

Thank You

Al...

[ValleYum]

As long as you make your payments in a timely manner, Indy Mac will be happy, you will be in compliance and there should not be any lack of stability (even if you don't sign a reaffirmation agreement). If you do choose to reaffirm - they may or may not begin reporting your mortgage history again - they are not required to.

PLEASE take the time to read through this thread about reaffirming a mortgage: http://www.bkforum.com/showthread.ph...-very-bad-idea.

Not reaffirming the debt, may afford you a better bargaining position in a modification. Good luck with your filing!

[help1234]

We have IndyMac and they did ask for a reaffirmation, but per our attorney's advice we did not. He pointed out that even though we have equity in the home, if something should happen to husband and his retirement were to stop, I alone could not afford the payment. Also, as housing prices keep dropping we might want to walk away at some point. It has been 2 years and we keep making timely payments... no objections from IndyMac. But more important to us is that we have left out options open if we do need an out.

[LadyInTheRed]

Many fine answers here and maybe one for me!

The answer to almost everybody who asks this question is do not reafirm your mortgage! If you keep payments current, they lender will not foreclose. Anything can happen in the future and you should leave your option open to walk away without personal liability.

[ullysses]

Thank you all for your answers! I am not going to reaffirm as it seems that would lock me in to a possibly bad situation. (By the way, the lawyer was also very passionate about not reaffirming)

Al...