I sent an email to Obama

[krielly]

Just sent the following email to our president to rant about the Fannie Mae/Freddie Mac guidelines for prime mortgages. Not that this will go anywhere, but I felt it needed to be brought up:

I have a question regarding Fannie Mae/Freddie Mac Underwriting guidelines, specifically, regarding mortgage eligibilty for individuals with a Bankruptcy on their record. Guidelines state that you must be 4 years post BK discharge for a Chapter 7, and 2 years post discharge for a Chapter 13. Therefore, its more advantageous/beneficial if you file a Chapter 7 (wiping out ALL debt) vs a Chapter 13 - where you pay back a percentage of your debt to creditors over a period of 3-5 years.
Example - someone who files Chapter 7 BK in 2005 will have a 90 day period until discharge. According to these underwriting guidelines, they would be eligible for a prime mortgage this year (2009). Conversely, if that same person filed Chapter 13 (again, paying back a percentage, if not ALL of their debt) they would be in either a 3 year or 5 year plan before discharge. Therefore, they would not be eligible for a prime mortgage until 2 years post discharge. Discharge would be 2008 or 2010 respectively. Therefore, eligibility would not happen until 2010, or 2012. Why is it that folks like my husband and I are penalized for being in a plan that actually compensates creditors (at least partially, if not fully)? Had we filed a Chapter 7, we would be elibible to refinance our mortgage now, but because we paid back a percentage of our debt over 5 years, we will not meet underwriting requirements until 2 years post discharge - which will be 2012.
My husband and I were forced to file Chapter 13 in 2005 due to my husbands failed business. We filed "old law", which means we had a choice as to which Chapter to file, at the time. We felt it was important to pay back as much of our debt as possible. It seemed like the right thing to do. Again, we had a choice, as we filed before the BK law changed. I was never late on a single payment to creditors prior to filing, and have never been late since. (4 years later). We pay our mortgage outside of the plan on time every month. We also have 2 vehicle loans which we pay on time each month. We have never, ever been late on a BK payment to the trustee in the past 4 years either. We both work (myself for the state) and my husband in manufacturing). We would like to refinance our mortgage with our a local lender to take advantage of the lower rates, but are inelligible due to these guidelines.
Conversely, had we filed a Chapter 7 back in 2005, with our unsecured creditors getting $0.00 - we would now in 2009 be eligible for a prime rate mortgage.
Isn't there something very wrong with this picture?

Thanks for your consideration. I can't imagine the guidelines intended for this difference in treatment. Had the guidelines read "xx" years post filing" - this would not be an issue.

Thanks Again.

[jtrenton]

Writing to politicians is useless in my opinion, but at least you expressed your frustration.

[krielly]

I also sent the same emails to our state representatives......
We are a really small state, and sometimes even get personal answers.....

we'll see. At least I got it out!!!!

[queenfluff]

I think that is great! They did say that Obama does read 10 snails and 10 emails a day from us "normal" folks. Who knows - someone over there might read it! I was thinking about emailing him to thank him for taking on the credit card companies with this new bill.

[WillinVT]

What email address do you send comments / concerns to the President?

[lrprn]

What email address do you send comments / concerns to the President?

Go to http://www.whitehouse.gov/contact/ and fill in the form. It's as easy as that!

And if you want to email your U. S. and state elected representatives, you can find their contact information here - http://www.usa.gov/Contact/Elected.shtml

[teacher]

I don't know that I agree with your reasoning that someone who files ch 13 should be able to get a mortgage quicker/easier than someone who filed a ch 7. We all may have come on different ships, but we're in the same boat now. (as said by MLK Jr.)

I do think they should be the same. Most people don't file ch 13 for moral convictions. They file because they don't meet the requirements for ch 7.

I do wish you luck in securing refinancing, may good juju and thoughts go your way.

[hamburgervol]

Doesn't FHA refinance 24 months after BK?

[momof3b1g]

I don't agree with your view. I think the reasoning behind those filing a ch7 and a 13. Is that those filing a 7 got rid of debt and those who filed a 13 are paying money back for amount of time. To me it would seem those in a 7 are better off financially. Does that make sense?
I have a headache right now and trying to understand the post. Is the amount of time after discharge the same for 7 and 13?

[justbroke]

I sent a letter to President Clinton in 1996 and never heard from him. My letter was on the "tax" on the middle class. (Ah, to be single and young again.)

[hamburgervol]

I received a personal letter from Bush in 2000. I voted for him twice too many. Maybe one day it will be worth something. Should I list the letter as an asset or as a liability?

[dgjmj]

I don't know that I agree with your reasoning that someone who files ch 13 should be able to get a mortgage quicker/easier than someone who filed a ch 7. We all may have come on different ships, but we're in the same boat now. (as said by MLK Jr.)

I do think they should be the same. Most people don't file ch 13 for moral convictions. They file because they don't meet the requirements for ch 7.

I do wish you luck in securing refinancing, may good juju and thoughts go your way.

1. I didn't get out of OP that they were saying that they were expecting anything quicker or easier quite the contrary.

2. While most people do not file ch13 for moral convictions this OP chose to for that reason prior to the 2005 change.

I believe the reason for the OP to openly share their personal letter to Obama were for principal reasons.

[Flamingo]

I don't agree with your view. I think the reasoning behind those filing a ch7 and a 13. Is that those filing a 7 got rid of debt and those who filed a 13 are paying money back for amount of time. To me it would seem those in a 7 are better off financially. Does that make sense?
I have a headache right now and trying to understand the post. Is the amount of time after discharge the same for 7 and 13?

I agree and got a similar view but I also agree (last poster above) it was regarding the principle of the entire situation. Basically, it is not fair. Those paying out a portion or all of their debt over a period of time under Chapter 13 have to wait longer due to that payoff period wherein if they dumped it all, it would only be a probable two year wait. But not everyone filing a Chapter 7 gets the brass ring 2 years out of discharge just due to the BK filing on their records. Eliminating all debt does not mean a thing if someone cannot afford a mortgage two years after discharge. Chapter 13 filings are viewed more favorably by creditors (we were personally told that by a few attorneys, brokers and bank reps) and that is indicated also by it being on your credit reports for 7 years whereas for a Chapter 7 it's 10 years. Hope all that makes sense - it's been a long, busy day in the legal/corporate world...

[tkharvey]

kreilly: I TOTALLY AGREE! We are new to this BK thing (filing 13 soon) and I thought the same thing. You would think that by paying back a portion of your debt would be looked upon more favorably when trying to get a future mortgage. I thought I was the only one that felt this was a bit backward.

[blankslate]

I used to work for a Senior Senator. This was before email was so readily available to the public and contacting a politician was through regular post and phone calls. I will say every single one of those went to me and into a file that the Senator himself never read. However, I notes on each and everyone and put them together in a summary for him every day that was read. I also brought some of them with me to advisory meetings and put them at the top of the agenda. He was an old school Republican who had conservative values, however the values of his constituents was the most important to him. He's been retired for some time now and there aren't many like him anymore who vote to reflect the people who chose him as their representative. Our political views were different, I voted for Clinton even though I was this man's right hand "woman" and we both respected each other's values. For many years after my time working in his office and being on a different political fence, I received hand written Christmas cards and invites to his summer parties.

Anyway, I do encourage everyone to write not only to their local politicians, but ALL of them. One virtually unknown Senator who takes the opinion of the people seriously is Bernie Sanders of Vermont. I think politicians on both sides have gotten arrogant, out of control, and forgotten that they are supposed to represent the people... not lobbyists. Bernie Sanders hasn't fallen into that trap yet from what I can see and his votes count for all of us too. Write him an email and see what happens. BTW I'm in Los Angeles so he's not my local rep, but his votes still affect me.