Post 341-EXISTING HAMP-TO RE AFFIRM, OR NOT TO RE AFFIRM?

[moonbeam9209]

I have been trying to find some advice on this, here is our situation:

Over one year ago, we were approved for the HAMP program, reducing our mortgage payment from 1500.00 (6.25%) to 940.00 monthly (2%).

We filed bk pro se and had our 341 on 7/23/12. Trustee asked if we were re-affirming our mtg, since I originally put on our paperwork that we were planning on re affirming...raised his eyebrows, he basically told us to think about that since we were upside down...

Paid 243k for our house in 2007, put 50k down, mortgage balance was around 193k last year/2011 before we were appproved for HAMP. After HAMP, we somehow owe closer to 198k I believe. I guess that bump in what we owe is because of the fees/interest/missed pmts... Our house is maybe worth 155k in today's market.

We don't even know if reaffirming is an option, since it is through HAMP and our Credit Union is the servicer. Even so, I don't want to owe198k on a home that is worth maybe 40k less than that.

I you already had a HAMP modification, CAN you reaffirm and does the mod become null and void after discharge?

We really don't want to have to move, we have two teenagers in an excellent school district, and a college student living at home. Besides, there are no places to rent for 940 a month anywhere near this area.

Hadn't heard from our credit union yet, but noticed on Pacer that a company by the name of "Prommis" who is representing our credit union sent a letter to the court:
"Would you be so kind as to add the following interested party to the mailing / service list in the above referenced case:
IBM Southeast EFCU
c/o McCALLA RAYMER, LLC
Bankruptcy Department
1544 Old Alabama Road
Roswell, GA 30076
Please provide us with a copy of each notice of any proceeding, hearing and/or report in this matter including, but not
limited to notices required by Bankruptcy Rules 2002(g) and the Local Rules of the Bankruptcy Court.
We appreciate your courtesy in this matter. If you have any questions, please do not hesitate to call me. "

I am thinking they may be contacting us soon.
ps. we also have a car with the same credit union that is paid off but they wouldn't give us the title because we owe them 8k on a credit card. Once the card is discharged, I wonder if they will HAVE to give us the title. Or if the car factors in at all with the mtg mod?

[ace300s]

I'm sure most of the advice you'll get is "dont do it"!

But I know exactly where you are coming from. I recently had my BK7 discharged. This included our house. We've lived in the home for a number of years, and hate the idea of moving, and renting.

I've been talking with our mortgage company about a loan modification and I feel they'll offer me something? However, our house is $70,000 underwater. I'm thinking they'll extend my loan with the late payments and lower my interest rate to make it cheaper than rent. But probably do nothing with lowering the loan balance......

Part of me says keep the house. But what happens if I want to move and sell in a few years? I'll be in the same place with a house underwater....

So, I've got a fresh start and do I want to muddy the waters with a underwater house to deal with?

[HHM]

Don't reaffirm. Given how upside down you are on your house, reaffirming would be a stupid move.

To answer your question, having a HAMP modification will not prevent you from reaffirming nor will a reaffirmation void the modification. But as stated, you are NOT going to reaffirm anyway.

[moonbeam9209]

Is it unheard of for a bank (or credit in our case) to reduce the principal in the reaffirmation agreement? I read somewhere that the judges don't usually approve if the Debtor is upside down.

If we do NOT reaffirm how long will we be able to stay in the house(while making payments on time..we haven't been late once since the HAMP mod).? I know that we cannot rent anywhere for anywhere near $940.00 in this school district, and there is five of us...

[Pandora]

The bigger question is because you were given a HAMP mod - you know upfront that your 2% current rate will increase after year 5 (3%, 4% 5%). So...can you afford the payments long term once your rate adjusts? Do you have a balloon payment at any time once the note is called?

There is no reason to reaffirm - you can do a "pay and stay"; that way down the line should something happen and you cannot afford the payments, you wont be held liable.