Stay or go?

[sleeplessinohio]

Hello,

Bottom line: we're just not sure what to do with our mortgage.

Here are some of the details.

We live in Ohio.
We have a subprime mortgage with Wells Fargo. 8.5% 30 yr fixed.
Chapter 7 BK discharged 9/21/09.
If I understand correctly, the mortgage WAS included in bankruptcy, but was NOT reaffirmed.
We are about even on what we owe and what the home is valued at. (Balance is 184,500 and the property is probably valued at about 190K)
Our BK was due to my husband losing his job. He is working again, but at a fraction of what he used to make.

We are current on our mortgage. But, it is so expensive that it just difficult to make ends meet. We have a daughter in college and a son in high school. If *anything* big happens, we have NO safety net. Our P&I is $1,430 per month. Our T&I is about another $400 per month. (Total then is $1,830 per month)

We are treading water, but I just keep wondering if we should walk away and rent for a while and try to buy again in several years. I do worry that rent around here will be as expensive as our home.

We just don't know what to do, and really don't know how to decide what is best to do.

If nothing untoward happens, I guess we *are* making it. I don't know if we'll be able to help our son through college. At the moment our cars are okay and I'm pretty sure that my job is secure. And, for now, our health is at least holding out.

I guess I keep thinking that the savings of several monthy mortgage payments would be a cushion if something bad happens to us.

Am I missing important considerations? Should we just keep treading water and thank our lucky stars that we're not as underwater as we could be?

As an aside, our attorney did not really have anything to offer us, when we sought his advice.

This forum was so helpful when we were in the long process of our bankruptcy. Guess I'm back and hoping for some advice again.

Thanks so much and best wishes to everyone.

sleepless

[onwards]

Figure out if you qualify for HAMP. You didn't post enough information for me to take a good guess, but having just gone through the process and receiving a permanent modification, it wouldn't shock me at all if you do.

Feel free to msg me if you want to chat about it privately.

[willsurvive]

I agree, look into a loan mod. Though be forewarned you might not get any "action" unless you are several months behind on your mortgage. We were 100% certain we were walking away. We filed bk ch 7 didn't reaffirm our house and stopped paying the mortgage for 21 months! We had a sale date of November 1st, and our bank asked us to please just fill out paperwork for a possible mod. We did thinking there was NO WAY that we would qualify or have a lower payment (with all those late payments, etc.). Anyway, the bank came back with adding missed payments, stretched our loan out (yes not great, but okay). Anyway, long story short, we are staying here because we can't rent for less than what they offered. Plus, we did not agree to refinance the money, only modify the old loan (thus in the future we could still walk away after they foreclose without a deficiency). You just need to weigh your options. Are you prepared to walk? Can you rent less than what you pay?

[BCA2009]

After you resolve the loan mod issue. Just look at the cost of renting vs paying the mortgage. If you can't rent what you need any cheaper it would make no sense to move. If at anytime in the future something changes, you can walk away then.

There are intangible involved, like not worrying about a landlord or having pets. So you will have to factor those in, if you consider the renting idea.

You have to consider repairs and maint. on the home if you stay, but you can always move if the A/C goes out or the roof start leaking. You don't have to fix those things before you move.

[Billssuck]

Your situation parallels ours in many ways (i.e., value of home close to loan amount, loss of job and got another making less, just barely scraping by, kids in college, etc.) but in others we're different (I'm in an active ch13 and am now I'm intentionally 4 months behind on mortgage).

For us, we decided to surrender our home based on what is best for our family's future (financial, physical, and emotional) and got a modification approved for it through our trustee. We could no longer make our payments without giving up other necessities and there truly was no end in sight. For us, we have two kids in college but one still at home and we don't need our 4,500 sq ft house with just three of us living in it. We can rent for cheaper than our mortgage is and since we're in our mid-forties, we know the type of physical maintenance this place needs and as we age, we just won't have the energy, time, or desire to take care of it. Once we through with our ch13 in about 21 months and have no huge mortgage payments to weigh us down, we truly will have a fresh start.

Good luck with whatever you decide to do.

[sleeplessinohio]

I'm very appreciative to everyone who responded to this post and especially to onwards who took time to give me some additional information.

I'm not sure what to do yet, or what is best for our family situation. Lots to consider.

I think trying to get a modification sounds like the best route. I need to research how to improve our chances of actually getting said modification. If that doesn't work, then we still have the option of walking away.

Thanks again to everyone who responded.