Anyone with recent dealings with Navy Federal

[Jf24]

I have heard of nightmares in dealing with Navy federal mortgages. I have both 1st and 2nd with them. Filing ch 7 next week, behind on both of them, would like to stay in house. I know it's bad having both with the same lender but it may be a double whammy having both with them.

Anyone deal with them recently? Or what would generally happen when both 1st and 2nd is with the same lender? 1st is underwater.

[BobMango]

If you are wanting to stay in the house with a Chapter 7, you'll have to deal with both mortgages. You can't do a lien strip in a 7 so the 2nd will remain after discharge. In any event you don't want to reaffirm your mortgages, but NFCU may require that before they consider any sort of modification. The filing will buy you some time, but depending on a number of factors, how long is anybody's guess.

If you are looking to keep the house you'll have to catch up or negotiate some sort of arrangement with NFCU. The other option, depending on your situation, is to file a 13 and strip the 2nd.

[justbroke]

Almost every credit union will be very aggressive when it comes to bankruptcy and, even, late payments in general. Since they are member driven, it is a direct impact on the CU's lending ability and membership. I don't find it a "nightmare" when the only option they have, like all other CU's and many banks, is to simply foreclose!

Having wrote that, in ANY bankruptcy where you are in arrears on a property, expect the lender to seek a motion for relief from the automatic stay, and to expedite (in many cases) the foreclosure of the property! It's just business for them and if you are not current and you no longer have any personal liability for a mortgage (or mortgages), you should rightly expect them to foreclose.

Personally, I don't think NFCU would negotiate bringing the mortgage current, unless you're talking about an "installment" plan to bring it current within 6 months. However, without reaffirmation, that may not be in the CU's best interest and they may just decide to not allow such an arrangement. If you have other types of accounts at NFCU, like demand deposit or timed deposit accounts, you may want to start moving those now (due to offset/setoff)! If you have automobiles, you could have issues as well due to cross collateralization.

I tell everyone entering bankruptcy that the fact is, you SHOULD have all your secured debt "current" or a plan to have them current before the case is discharged. Otherwise, expect that the lender will move to repossess or foreclose upon the collateral (car or home).

By the way, how far underwater are you with the first?

[Jf24]

1st is aboout $15000 underwater.

[justbroke]

1st is aboout $15000 underwater.

What's the percentage underwater? If $15,000 is more than 10% of what you owe (both mortgages), you may want to walk anyhow. Having the same lender for the second, especially with it being a credit union, may make it very difficult without bringing both current and paying!

Again, I would walk if there is no financially sound reason to stay and pay. There is certainly not one to reaffirm.

[Jf24]

Owe $240000 on first and $55000 on 2nd. Worth $225000 (appraisal). If they would work with me to get current I would stay. Main priority is to stay. Not calling them till I file next week. Defiantly not going to reaffirm. Rent here in NY is very high.