Need Help

[trashy]

Chapter 7 discharged in July 2011. Did not reaffirm house but kept making payments on time. Have not taken any loans or credit cards since bankruptcy. Wife became disabled due to medical conditions in July 2011 so her income was lost. I have held it together until now. Wife recently diagnosed with rheumatoid arthritis and extra meds are destroying me financially. Now 60 days late on house mortgage. Starting to get letters threatening foreclosure. I need advice. Mortgage company (Bank of America) says any workout will require a reaffirm. Don't plan on walking away but hate to reaffirm. Payment about the same as I would pay in rent so no advantage that I can see in walking away. I welcome all comments and advice.

[gregemm]

I have gone through a couple of loan modifications with BofA, and have discussed many of their workout options with them. Their modification documents are much like the loan docs, where you sign it agreeing to pay under the new terms or they can do what they need to do. While not reaffirmed through the court I would think it would have the same effect. I don't think you even can reaffirm through the court at this point since it's been discharged.
Only exception would possibly be a repayment plan where you have to pay the past due back over 3 months. I don't know why but both times I fell behind and asked for help that was their first solution, like somehow I could go from not making the payment to paying double for two months.
I will say that with BofA persistence is key, and keeping on top of them when they are supposed to be doing something. Plan on sending them the same info 3,4,5 times and playing phone tag for weeks. I finally gave up, plan on moving when I need to..

[Miknan]

Trashy, if you are having trouble paying now, under no circumstances reaffirm. I know that isn't any help but all these things happened to me when my wife got an autoimmune disease. I'd try to keep working with the bank but don't reaffirm.

[TBA]

i didnt think you could reaffirm a debt once it has been discharged? There have been other posts on here about it which is where i am getting my info. Therefore they cannot force you to "reaffirm" because your bk is closed and your debt is discharged - they can encourage you to refinance which would mean its a new debt.

[trashy]

Perhaps I used the wrong phrase (reaffirm). But what I meant was, as of now I have the ability to walk away with no fear the mortgage company will come at me for the difference. If I refinance or enter into a new agreement I lose that position. Thanks for the advice. I'm just a little overwhelmed with this. Holding a job and trying to be a caregiver also is kicking my butt. Just doing the best I can and trying to keep sanity. I guess the mortgage company don't want the house back and can't get me for the difference is a pretty good position. I don't mind signing for a new loan but they are going to have to make me a sweet deal.

[Drazil65]

MY advice, DO NOT RESIGN UP for the debt especially with BOA. I agree with above posts, if you are having trouble now why would you even think of putting yourself on the hook again. BOA is averaging about 2 yrs to foreclose and more than likely they will sell off your loan to some junk debt buyer before it gets to foreclosure and then you start all over again. Really think about this before you sign on the dotted line. Can your wifes doctor maybe prescribe a generic brand of meds for her? Good Luck with all this!

[TBA]

I agree with draz and everyone else on here - dont panic - if you are upside down, get a plan in place and let it go. stay there as long as you can rent free and SAVE SAVE SAVE!!!

Then when they finally complete the foreclosure and you have to vacate, you have lots of cash to find a good affordable rental.

Its super stressful, but once you make the decision, it is a small weight off your shoulders. it will get less and less as you progress.

GL!!!

[DeadManCrawling]

I would also add this:

I, too, am disabled by an injury. Is your wife receiving SSDI (government disability)? If so, she should have or be eligible for Medicare, which covers everything and does it pretty well. There IS a 24 month wait, from onset date of disability, so you may be in that hole.

If she is on long term disability coverage through employment, you should be working ASAP, really I MEAN ASAP!!! to get her approved through the government. It took me over FOUR YEARS. I feel like I gained another college education through the process, which is very complex.

Finally, there are ways to get medications for less money, or even free, through almost all pharma companies. Search the manufacturer of your wife's meds and look for these programs. They are means-tested, usually, but could make all the difference in a case like yours.

Good luck, my friend, I understand where you're at, and have been there.

-dmc

[LadyInTheRed]

You cannot reaffirm a debt that was discharged in bankruptcy. A reaffirmation must be entered into before discharge and filed with the court. Even if you were to sign an agreement that says you are reaffirming the debt, it would not be enforceable. If you are eligible for a modification, that is not the same thing as a reaffirmation or a refi. Ask BoA about modification. If somebody tells you that requires reaffirmation, ask to talk to somebody who knows what they are talking about.

[trashy]

Yes my wife has applied for SSDI and has been denied 3 times ( as is the norm ) the attorney says it is a very strong case and he is about 90% sure of approval at hearing. However at best i am 6 to 8 months out from seeing money. Unfortunately my income keeps the drug companies from helping. Will be contacting BOA today to inquire about a loan modification. Not upside down in house but no equity either. Pretty much a break even. Thanks for all replies.

[trashy]

BOA is offering me a loan modification. Take the balance owed and stretch it back to 30yr with a 1 1/2% reduction in interest rate. Have to make 3 of the new payments on time to completely seal the new deal. My mortgage is a very small deal to them and basically they don't want the trouble of taking it back. I don't know much about this stuff but this really doesn't sound like a bad deal to me. Anyone have a comment or suggestion ?

[gregemm]

That's what they offered me twice in the past, except no 3 month trial. In my experience and many others I've talked to, they will ask for all the info again at 3mos to confirm you still qualify. Only reason I had a problem with it was because immediately after signing my hours got slashed, so my mortgage payment went from 31% of my income to almost 70%..

If the terms work for you, should work out..

[LadyInTheRed]

If you can afford the payments over the long term, go for it. If you don't think you'll be able to afford the payments, you might as well live there for free for a while and save the money until they foreclose.

[stray]

Hi trashy. I'm very sorry for your circumstances. I got a modification with Wells Fargo a year before my BK. It was a year-long process. They immediately gave me a payment and set up the 3 trial payments which I did on time. Then they said I was denied because I didn't send in requested documents -- that were never requested. I requested a new application and started over. They did this 3 times. On the 3rd time, they made a mistake and sent me a written letter requesting documents dated a day after another letter that denied me for not sending in "the previously requested documents". I wrote a letter discussing the dates of their letters, along with the updated financials they requested and was approved right away.

A friend of a friend works for one of those loan modification companies processing mods with all different banks. She told me to call them at least once a week (record the time and name) and ask if there are any documents they need. Each time they told me I didn't need to call, but I did anyway. And I did have to refer to my log several times during the process to keep my foreclosure on stall.

So, yes, if the payments are affordable like lady said, then that's great. I know you have a lot on your plate, but do try to call them once a week especially after the 3rd trial payment.

[gregemm]

Something else I just thought about too a and not sure if it still helps at all, but after the first time of being run in circles (first time around with them took me 6 months to get anything). I contacted the office of the president/CEO of home loans. I had my initial response, paperwork signed notarized and finalized in a week. My second time around I was initially denied since I had one already but met the requirements for an exception. That time also took 6+ months, and wasn't going anywhere until I got my senators involved.
The new CEO doesn't seem as helpful but I do still get responses in a day or two when needed. Definitely keep on them and keep documentation nearby because they will need more or lose what has been sent