This is a sticky one.. My husbands ex wife quit claimed house in divorce. He was behind and we caught up. Ex wife filed for BK and mortgage was discharged. He has never taken her name off by refinancing as his credit is not good since he was left with 80% of marital debt because he made more. Mtg co never sent him anything to reaffirm the loan, we've just been paying every month. Have fallen behind due to him having a job making $40k less a yr and were making late pymts and including late fee. We were trying to make a pymt online before we became 90 days . Thus the pymt wouldn't go through. Now during this time we noticed that GMAC placed mortgage with Ocwen. We called Ocwen immediately since pymt wouldn't go through. the first thing he says is the mortgage has been dishagred and part of a BK so I cannot try to collect this. He explained that we were actually 4 days past the 89 day mark and the loan is in default. He wouldn't accept our $2400 pymt(sept) and said only full pymt would be accepted and needs to be paid by dec31, $9700. Then he said or we could go to January 15 but pay the $9700 plus $2400 for jan or it would start foreclosure. Or we could try for a modification. We're up in the air on what to do. The house right now is at a break even if we sell. If we don't get approved we'll lose the house anyway. And if we borrow the money to get caught up, we're afraid that we'll fall behind again being we've been struggling so since the huge pay cut. Do we just save that money and move and let them take the house? Is the loan really ours if he never reaffirmed ? Should we short sale?
I have had several conversations in the past few weeks around the discharge of mortgage debt through a bankruptcy.
All of the conversations I have had around this subject are very similar in that:
- I discharged my mortgage through bankruptcy
- The home is upside down but I didn’t want to lose it
- Now I want to buy a new home with a more affordable payment
What it boils down to is that when mortgage debt is discharged through BK, it does not mean that you own the home free and clear, and it doesn’t mean that you’re off the hook for the mortgage.
When mortgage debt is discharged, you are protected against any personal liability should the home foreclose through or after the BK – this essentially means the lender cannot come after you for their losses.
Many times the mortgage debt will show up on the credit report as “included in bankruptcy” with is slightly deceiving because it implies that the debt is no longer owed…which is not the case.
The challenge is that if you decide you do not want to be shackled by your upside down mortgage at any time in the future, you are still facing either foreclosure or short sale to rid yourself of the home.
To buy again after bankruptcy you have to wait for 24 months before you can use a FHA loan for the purchase of a new owner occupied home.
Once the bankruptcy is complete, homeowners are still faced with the fact that refinancing into today’s lower rates is not possible due to the fact that the home is upside down.
Renting the home out to buy again after the 24 month bankruptcy wait is also a challenge, as I have detailed in this article: Can I Rent Out My Upside Down Home and Buy Again?
I am keeping a close eye on this, I think that many home owners are in this situation now after filing for bankruptcy a couple of years ago.
I think this is an important conversation to have as there are many families trying to get back on their feet after tough times.his topic?
Do you have any experience or questions around this topic? Please leave comments and questions below if you have a specific situation you would like to discuss.
Branch Manager at Broadview Mortgage Long Beach, California, I am passionate about educating and empowering consumers. Feel free to call, text or email me at (714) 805-7268 or ScottS@broadviewmortgage.com
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Further question re: homeowners insurance; original lender advised intent to foreclose on property, house has been discharged in bankruptcy, we're still living in the house waiting out the entire foreclosure process; under those circumstances who is responsible for maintaining homeowners insurance
Hi- My husband and I filed chapter 7 in 2009. We live in Colorado. We kept our home and have never missed/ had a late payment on our first mortgage. In addition we had a second/home equity lihne of credit through Wells Fargo. This was discharged and we have not made a payment since 2009. We recently tried to take advantage of the low interest rates and re-finance. Problem is we cant as Wells Fargo has a lien on our property. We have contacted the attorney that handled our bankruptcy but they state there is nothing they can do. We have contacted Wells Fargo and offered to settle or even have them re-finance our first and second- they state they are unable to do anything as our second was discharged. What will happen if I sell? How do I get someone to work with me in resolution? Not sure what I should be doing or how to resolve- any advice/suggestions would be greatly appreciated. Thank-you!
Please help and explain in easy terms for me to understand. Filed bankruptcy and discharge was jan 2011. I continued to make my house payment and still am. There was also some type of second mortgage and it was pay the interest for so many yrs then you make payment. Well I always just sent them $75 a month cause the statement would show like $50-$65. I had continued paying this after the bankruptcy until a few months ago I got a letter from Key bank saying regulations require the account to be charged off unless the debt is reaffirmed. Also i could continue to mail payments to some attorney office. Well I really have no clue what I even was suppose to be paying them, so I never sent anything. (I know wrong). Anyway now I got a letter again from Key Bank listing the account number etc.: You entered into a consumer transaction described above on which Keybank presently holds the title/lien securing the account. Keybank is aware that you have been discharged in your bankruptcy from your personal obligation on the promissary note for which the security interest was granted. Nevertheless the security interest in your property was not discharged by the bankruptcy and keybank has the right to enforce its lein. Upon review of this letter please contact the undersigned to discuss your intent with respect to the property. While you are under no personal obligation to pay Keybank the payment due under the note, we may nevertheless exercise our lein rights under the law including our right to repossess the collateral or foreclose on the property. We look forward to hearing from you in regard to your intent regarding the property. Please be advised that keybank may exercise it rights under its security agreement without sending you another notice like this one. If you have any questions please write to keybank or telephone the number below. This is an attempt to collect a dept and any information obtained will be used for that purpose.
I have a unique situation. I am preparing to file chapter 7 . I have no real estate in my name I sold the house over a year ago I did not payoff the note because the original lender had filed a release 4 years ago and they are out of business now. They apparently made a mistake when I paid off a second mortgage they also released the first.
I live in michigan...our bankruptcy was discharged over 2 yrs ago. We have rebuilt our credit & just started out on the mortgage hunt but have hit a huge road block. The lender never took our name off the house so essentially are being told we still own the home and need to ask the lender to start foreclosure and then have to wait out the time after the foreclosure is done before getting a mortgage. I checked with the county and indeed our name is still on the house but don't understand why this is a problem for getting a mortgage since we don't have financial responsibility (mortgage was included in the bankruptcy). Our attorney told us not to do a deed in lieu as it would tie us back financially to the house.......ugh, anyone know this gray area?
I am in Louisiana and my husband and I filed for Chapter 7 when were married. After we were discharged in December of 2011, we divorced in July 2012. My question is since we were discharged from the debt yet we are still the homeowners how does this work. He has since remarried and is pushing me to either refi or sell the home which I have continued to live in and have continued to pay the mortgage and it is current. His issue is that this is affecting him to buy a new home with his new wife. Can he sign a quick claim deed and it can free and clear him since we are already cleared from the debt per the bankruptcy prior to divorcing? Can he force me to sell the home because I do not want to refi because at this moment we may just break even and then I would be locked into a home more than its possibly worth if I can even refi. Your thoughts are appreciated.
I am in Michigan now where my home is. My original loan was for 135k and the house was appraised at 55k. I have filed for bankruptcy and I will have my first meeting in court on Nov. 21st. My question is... I am behind on payments with my loan but I did not include my home in the Bankruptcy. Am i going to be able to buy another home sooner than the 24 months? My family has outgrown the house and honestly I want to move on but feel as though my hands are tide. Any insight? Help... thanks
My home was included in a BK, the original mortgagor was foreclosing on the property but has sold the loan to another Mortgage Corporation, how does that affect our discharge debt? We are still in the house/
Thank you so much for answering our questions. Here goes another question... our house was included in BK and the second also, discharged in 2011. We are going to short sale but the value is getting close to what we owe so if by chance it sells for what is owed on the first , what happens to the second which is $100,000?
We filed BK and included our home in 2008, discharged 2008 and we had already moved out of the home. Last year we bought a home FHA (2012) Now we have our home for sale and want to buy smaller only to find out from our broker that we got lucky to get financing last year because no one did a title search but now we can't get another FHA loan because the banks just sold the home in 2/2013 and just changed the title out of our name. It seems that they sold the home to 4 different lenders in the last 5 years. How is that legal for them to sell a mortgage that is protected by bankruptcy? How is this fair to us and who in Congress do we need to write to get this changed?? Does FHA ever take this into consideration?
I really enjoy reading your comments and replies.
(Some History) We purchased our home in 2005 at the top of the market in NJ. We paid $459k for the home and took a mortgage of $340K. Two years later 2007 with market still strong we took out a 2nd mortgage that is now owned by Chase for $75k to rebuild kitchen, baths, and many renovations. In 2008 my wife lost her job due to downsizing, 2009 we were forced to file ch 7 due to mounting debts and were discharged in 2010. Both our 1st and 2nd show as discharged on credit reports although we never missed nor were we late on any payments.
2011 we were very financially sound again (3 year job search) and started rebuilding our credit. We noticed that we were not receiving credit for making the 1st and 2nd mortgage payments on our Credit report and as stated listed as discharged in ch7. We contacted Wells fargo who owns our 1st mort and asked if they would reaffirm our mortgage. They state they are unable to do this as it has to be approved by the court and should have been requested at the ch7 proceedings by my attorney. Chase, our 2nd mort states they cannot do anything. My Attorney no longer practices, Another attorney states would have to reopen entire case.
Question #1 Any suggestions?
Question # 2 Although we are financially sound again and able to build savings and new credit I am concerned with the fact market is still dead. My home is currently appraised at $385K. Still owe $380-390k with both mortgages. I plan on retiring from my career in 3-4 years and relocate. If I am still upside down what do you suggest to be my best options since I have 2 mortgages with 2 different banks
-Rent home out?
-Walk away from home?
-Should I try to talk to mortgage company about short sale or sign over deed if they will let me walk away. But have two mortgages?
Alabama....We have found a home that has been vacant since 2010... We want to purchase it. Found out that Bank of America held mortgage. I called them they said they "service" the address but we would need to contact our county probate office and find out the owners names and make them an offer. I tracked down the owners and they say they lost the house in 2010 through a chapter 7 bankruptcy. Their attorney said they cannot sell it that it was discharged and the bank could come back after them for taxes and "servicing" fees and not to be involved in this in any way that if we want to buy it we would need to call Bank of America and make them an offer. I call Bank of America back and they say these people still own the home and Bank of America cannot sell something they don't own. What can we do to buy this property.
Hi! Scott. I filed bankruptcy in 2008 December and discharged March 2009. After bankruptcy, i had loan modification with my first mortgage which is GMAC. I had senconed mortgage payment with Wells Fargo. But Well Fargo never send me billing statement so i never made any payment after loan modification with first mortgage company. Now it's three and half years past. I got a letter from Wells Fargo that they released my second lien and they will clear out lien at the county. In September i mean this month I didn't get the statement with my first mortgage company which is GMAC now changed to OWCEN and I called Owcen asked why I did'nt get statement, they told me it is illegal to send me staments from now on. So I told them if I don't get the statement then I don't want to make a payment.. They said I can make a payment with online. Now I don't any idea with my first mortgage company. Please help. Thank you
Me and my husband filed for chapter 7 and was discharged 6/11. In my bankruptcy I encluded a 1st and 2nd mortgage I had on an investment property. although my owner occ home was included on the bankruptcy I never missed a single payment and still have not missed a single payment on this home.( Chase contacted me and was able to refinace this mortgage to a lower interest/payment after my bankruptcy so my pay history now reports on credit) The rental property was officially foreclosed on 6/13. Me and my husband are moving to a new city and plan to sell my owner occ home. Am I right in thinking I will not be able to finance a new home until I wait 2-3 years from the final foreclosure from my rental property even with 20% down, good pay history from my OO home reestablished credit a 3 year employment history??
Hello. I filed for bankruptcy in 10/2012. My discharge was complete in 02/2013. At the time of my filing, my mortgage was with BoA. After filing, I received a letter from BoA that notified me that my mortgage had been sold to Nationstar effective 12/2012. All of that is fine because I planned to keep my home anyway. My question is, why does my credit report show Bank of America as being discharged in the bankruptcy and transferred to a new lender? Does the discharge status on BoA have a negative affect on my credit? And at the time of filing for bankrupty, I was 2 months behind on my mortgage.
@Princess1126 If you can break even on the home by selling it, that is by far your best option. It is only a short sale if the proceeds from the sale are not enough to cover the loans against the property. You're probably going to need time to do this, in which case I would talk to a bankruptcy attorney about your options for postponing the foreclosure so that you have time to sell the home.
The house is definitely still yours, and the debt is yours as well if your husband was on the loan. Just because the ex filed for BK protection, doesn't mean that your husband is protected. He's still completely on the hook for the mortgage, and he's on title, so he's the sole owner of the home.
Do NOT let the home go into foreclosure if you can help it. Especially if it's not upside down.
That's my opinion, hope it helps?
@sugaroneus as long as you are still on title as the owner of the home, you are 100% responsible. Including a mortgage in BK does not change your ownership, it only protects you agains tax liability in the event of a default.
Hope this helps?
@CH72009 Wells Fargo does have the ability to help you. You just have to find the right person to speak with. If you owe more than the home is worth, you will need permission from both the first and second lien holder to sell for less than what you owe - this is called a Short Sale.
Unfortunately, you will have to deal directly with the lien holder to discuss your options. Refinancing probably isn't an option since the "correction" of the the second mortgage is required, this means catching all of the payments up (with on-time payments for 12 months).
Ask to speak to the bankruptcy division at Wells Fargo, or just ask to escalate your call to a manager, and hopefully they can point you in the right direction.
I'm sorry you have to jump through all these hoops to get an answer here - it shouldn't have to be this difficult to get straight answers!
Hope this helps?
@elange Bankruptcy protection will prevent any additional credit hits, tax liability or financial liability, and Keybank is absolutely right. There is still a lien against the property securing the 1st and 2nd mortgages. Should you stop making payments, the bank has ability to exercise their right to foreclose in an attempt to recover as much of what's owed to them as possible.
Remember, BK doesn't mean you don't owe the money, it just means that you cannot be sued or taxed if you default on the debt.
The only way to cure this is to make arrangements with Keybank which may include catching up all the payments and keeping them current, or settling for less than what's owed in exchange a release of lien.
Is the home upside down? Is there enough equity to pay off the first and second mortgage?
You may want to speak to a real estate attorney because the second lien holder can force the foreclosure at this point.
Hope this helps?
@william pelfrey this is a unique situation William. A lender will look at public records to determine the status of the liens and the circumstances under which the liens were removed. The lender will pull public records to verify the liens removed from the home, and follow the paper-trail to determine the conditions under which the liens were removed.
I can see a possible challenge with proving that the home was not a short sale or deed in lieu if the notes were not actually paid off.
If you're in California, I would be happy to look into the the paper trail to see if any red flags pop up that might cause questions later down the road?
If you're not in California, you are asking for a chain of title from the county recorder office or a title company.
@Malyzoelma I am really sorry that you're going through this - sounds like a pattern of misinformation and bad advice here. Bankruptcy only protects you tax or deficiency liability in the event that you lose the home and the lender takes a loss. BK does not affect your ownership in the home at all.
You will be unable to buy another home until your name is off title of your current home. My advice would be to contact the lender and see if they will do a Deed in Lieu. This does not make you liable, it actually relieves you of all liability.
Hope this helps?
@soccergirl2013 The short answer is that Yes, he can quit claim off title and you will own the home as sole and separate owner. The more complicated issue here might be how the asset was addressed in the divorce decree. Unless you specifically stated in the decree that he has no ownership or responsibility for the mortgage, he may still have challenges buying a new home.
Bankruptcy does not absolve you of the responsibility for the mortgage or change your ownership position, it simply protects you from impacting your credit, or subsequent lawsuits by the lender in the event of default.
Hope this helps?
@Cerika2010 there are two timelines you will need to be aware of when trying to buy another home. The first is the Bankruptcy. If using FHA financing, you would be eligible to buy again in 2 years. If using Conventional financing, the wait is 4 years.
As far as the home goes, what was the reason for excluding it? The reason I ask is that if you are behind on the payments, and if the loan goes into default and you either lose the home to foreclosure, do a short sale or a deed in lieu of foreclosure, you could be liable for the loss that the bank takes. This would be reported as income to you, which will create a tax liability.
The second timeline will only come into play if you cannot pay the full balance of the current mortgage. If you do lose the home in one of the three ways I described above, depending on what you happens to the home, it will trigger another, separate but concurrent waiting period before you can buy again.
If you catch up on the payments, and make the payments on-time for a minimum of 12 months, then it's possible for you to buy again once the bankruptcy waiting period is up as long as you can afford both payments on your current and new home.
Hope this helps? Please let me know if you have further questions?
@sugaroneus It is not uncommon for lenders to sell the loan after being included in a BK, especially if you've stopped making payments and defaulted on the loan. The new lender may contact you in an attempt to modify the loan, or offer a deed in lieu of foreclosure, I see this a lot too.
If you write a new loan with the new lender (loan modification), you would not have bankruptcy protection on the new loan.
Simply the fact that the lender sold the loan to another mortgage corporation will not affect your discharged debt.
Hope this helps?
@zgirl it depends on how the 2nd lien holder dealt with the default (you stopped making payments?). You need to see what happened to the 2nd lien. If you defaulted on the loan, your "waiting period" would start from the time your name is removed from title. If there's a lien from the 2nd, the sales price will need the approval of both lien holders, and the total of both liens would need to be satisfied in full or a short sale would be required.
If the 2nd lien holder has removed the lien, and if you can cover the pay-off of the first loan, including closing costs, your "waiting period" would begin from the time the second lien holder removed their lien.
Hope this helps?
@jennysue67 I completely understand your frustration, unfortunately this problem comes from bankruptcy attorneys not knowing that banks would not foreclose. Unfortunately, bankruptcy only protects you from further credit reporting by creditors, and taxes due in the event that the lender takes a loss should you stop making payments and they must foreclose. It is not unusual for banks to sell the loans, or servicing from one to another, especially if the loan went into default. Bankruptcy also does not extinguish any liens against the property. You still own the home after BK and if you stop making payments, the lender is allowed to foreclose.
Here's a thought, have you looked into the FHA Back to Work extenuating circumstances exception? If your household income dropped 20% or more for a period of 6 months, then you may be eligible to buy after 12 months of no late payments. That would make you eligible in February 2014, that's not so far away?
Hope this helps
Thank you for the quick response. Your information provided was very helpful. My choices are much more clear.
@Globalpct thank you for the question Rob, you bring up a very good question, and I have a very good answer for you :)
The fact that your mortgage does not report on the credit report does not affect your credit. In terms of how the credit bureaus calculate your credit score, a mortgage is an installment loan, similar to a student loan, or auto loan. A mortgage has a fixed loan amount, and a fixed payment. The only thing factor that the bureaus look at is if an installment loan is reporting, that the payments are made on-time. The absence of a mortgage is not a negative factor on your credit.
In the event that you ever want refinance, or buy a new home, the lender will simply contact your current lender and order what is called a VOM (Verification Of Mortgage) to document your history of on-time payments.
DO NOT fall behind on your payments. I have actually heard stories of homeowners that stop making their payments because it didn't show up on their credit.....that's just crazy!
If a tree falls in the woods and nobody is around to hear, it does make a noise. If a mortgage is being paid on-time and it doesn't appear on your credit, it still establishes a history of on-time payments!
Second Question: There is no right answer here. Continue to make your payments and, if you are able, pay a little extra each month to apply directly toward principle.
If you can cover all payments, taxes and maintenance by renting the home out, that's a great option that may create a great income stream for you in the future.
DO NOT WALK AWAY! Including a mortgage in bankruptcy simply means that you cannot be sued by the bank if you default. If you walk away, or stop making payments, the bank still has the right to foreclose. A foreclosure is a matter of public record, not necessarily a credit reporting issue, and it will prevent you from buying a new home for several years.
A short sale or deed in lieu could be options, but then again, this is very similar to a foreclosure in the sense that it is still considered as a negative (settled for less than amount owed) and could require a waiting period before you would be able to buy again.
It sounds like you are close to owing about what the home is worth now? In 3-4 years when you retire there is a really good chance that you will have enough equity in the home to sell it without a loss.
Sorry about writing a book here - I hope this helps to answer some of your questions?
@Kristeng2217 Bank of America gave you the right answer. Nobody can "lose" a house through bankruptcy. BK only provides protection agains financial liability in the event of a default.
It sounds like the owners stopped making payments, moved out of the home, and Bank of America never foreclosed. This commonly known as a "Zombie Foreclosure" - the owners probably don't even know that they still own this home.
You should be able to look up title records to find who the owner of the home is. If you can find the owner's name and contact information, and if you make an offer which is less than what they owe BofA, you could enter into a short sale offer, and BofA has the ability to accept less than what is owed them.
Hope this helps?
@payment I think you should try to speak to a manager at OCWEN to get a straight answer. If you have a loan modification on your first mortgage, and if there was any principle reduction involved or a new loan with new terms was written, then your first mortgage is re-affirmed and no longer protected under the bankruptcy.
To stop making payments would give the bank the right to foreclose, and take the home. Do not take any chances! If they say you can make payments online, make them online. I would ask OCWEN to provide you the instructions of how to make your payments now that they are your servicer. Get it in writing!
You may also want to get a real estate attorney involved if you have the means.
Sorry I can't offer anything more concrete, I hope this helps?
@Looking for answers You are right in thinking that. The timelines to be eligible to buy again begin from the most recent event. So, even though the home was included in the bk, and that timeline began upon discharge of the bk, a new waiting period began as soon as your name was removed from title on 6/13.
The waiting period to buy an owner occupied home using FHA financing after a foreclosure is 3 years, unless you think you could be eligible for FHA's Back to Work extenuating circumstances exception.
You can read up more on this exception here: http://www.findmywayhome.com/home-mortgage-news/fha-back-to-work-extenuating-circumstances-explained/
@Nicolemomof4 It is not uncommon for lenders to stop reporting your mortgage after a bankruptcy, and because there is no recourse (other than getting the property back) for the bank in the event that you default, it's also a common practice to sell that loan to a lender better equipt to manage high risk loans.
The Bankruptcy is the only thing impacting your credit scores, temporarily, until you build positive credit. The fact that it's showing as discharged and transferred does not specifically affect your score.
You said you were 2 months behind when you filed, did you catch the payments up, and making payments on time since the filing?
This is very helpful- I will call them again. I appreciate your input and quick response! Thanks so much!
@ScottSchang @elange My first mortgage is current, I have been paying the payments. I am quite certain I owe more than the home is worth. My current mortgage I owe about $89,000 and the keybank mortgage (2nd mortgage) I owe around $23,000. This home is prolly not worth more than $75,000.
So what happens if Keybank forecloses?? What happens with the first mortgage?
@ScottSchang @soccergirl2013 We never fully settled community property. We did a consent judgment where I have use of the home until I could refinance. I never realized until he just started pushing the issue that we were released from the debt, meaning if I wanted to I could walk away and they can't come back on me for any negative amounts owed. Can my ex force me to sell though? So I just discovered we were releases from the debt . I was wondering why it was showing up on my credit report as a debt owed. So I wonder if I need something drafted by a divorce attorney stating what you said he has no ownership or responsibility of the mortgage and also he can sign the quick claim deed.
thanks for your quick reply, I have to correct myself, the house was added to the bankruptcy. Am I just with my hands tied for 2 (long) years? I know everything takes time but the mortgage won't work with me about the fact that the house is worth one 55k :(
so I really just want to be able to maybe move on but don't know what options I have. Do I even have any?
We spoke with owners they were advised by their bankruptcy attorney NOT to be involved in any of this at all. That I would have to talk to Bank of America but Bank of America cannot give me any info because I am not on the account
Yes I have. I was just concerned about those 2 statuses since I am trying to rebuild credit. Thanks!!
@elange @ScottSchang This is going to be an up and coming on going problem as home values rise and junior deeds that were discharged in bankruptcy can be called in. My loan servicing recently went from BofA to Nationstar. I have a junior deed that was discharged in chapter 13, with the minute order for motion to value ordering the lien reconveyance. BofA was served at the time of the chapter 13 discharge, did nothing and again Nationstar was served after they took over. They are extremely unorganized and have, in contempt of court, tried to collect from me on the discharged junior deed. It's probably only a matter of time before they try to enforce the lien once my home value rises. Therefore, I have sent extensive detailed documentation with attachments to the Consumer Financial Protection Bureau. Even if they cannot help me (which I doubt because Nationstar has not met the RESPA guidelines, has tried to collect on a discharged debt which is contempt of federal court and keeps playing dumb about understanding the motion to value order which they, as a federal institution have access to anytime they want), and I have to open an advesarial action against Nationstar, it is good for them to be notified of the practices of these financial institutions they oversee. You should definitely contact them through their website. You can file a complaint online that they will investigate. I don't believe, now that we have weathered all these foreclosures and finally got the banks to be more agreeable in working things out with homeowners, that the government will risk another effect on the economy by these institutions trying to foreclose through these discharged junior deeds and causing another wave of foreclosures. Consumer Financial Protection Bureau keeps statistics as the overseer of all financial instutions. Then they take action as they are now with the payday loan companies,
While it is true that the lender cannot go after you for a deficiency judgement if you owe more than it's worth at the time of the foreclosure, the fact that you defaulted on the mortgage which resulted in foreclosure is a matter of public record and would prevent you from buying a new home until you've met the waiting period requirements.
In regards to your ex forcing you to sell, that's a legal question that you should ask of your divorce attorney.
@Cerika2010 @ScottSchang your hands are tied for 2 years because of the discharged bankruptcy. What happens to the home is completely other issue. Your options are to either keep the home, maybe rent it out, and continue to make both payments, or do a short sale or deed in lieu of foreclosure.
I would not recommend just walking away from the home because the bank could take years to foreclose, and that would put you that much further away from being able to buy another home.
There are other options, it's called hard money, or portfolio lending. These are high interest, high cost, usually short term loans that will allow you to borrow money if you have a large down payment - usually 30% or more down payment.
Your best bet, if you think you are not going to stay in this home, is to attempt to short sell or negotiate with the bank to do a deed in lieu.
That would put your timelines of both the BK and the short sale or DIL pretty close to the same.
I don't know of any other solutions being offered by Government or Conventional lenders.
I know it's not the news you were looking for, but at least knowing what options are available to you puts you in a more informed place when making decisions moving forward.
By doing nothing, and letting the home go, it could delay your ability to buy again for years more than is necessary.
Does that make sense?
Im dealing with the same situation kinda only diff is thishouse was for rent soo I looked up the info a d talked to the owners told them a guy was trying to rent it to me as the new owner they confirmed what he said they lost the house in chap 7 bankrupsty and dont own it I told them the house was still in there name and I wld only move in with there permission givin the fact the home is still in there names so they said I cld move in well 3 days later cops come ask why im here I told them the story I guess the guy who rented it was a scammer and I think the owners were in on it but ne ways the cops call the bank the bank says the owners still own it sooo the owners say no we lost in bankrupsty and signed a deed luir of forclosure so when they found out itwas still in there name they thought they got lucky so they locked me out and kept all my property and my sons property they wanted too sell the house but was advised not to sell because legally they cant (thats the hard partwho really has the rights to the home?) So now there renting it out.... and kept my property the bank says the dont own it yet but the bank wintereised the house legally they wld have to own the home to take possession mostly of the time if you do not refirm the debt the bank will have u sign something giving up ypur rights even tho they have not forclosed yet nor filed the paper work they still technically own it and if the owners try to sell well they will be in bigggg trouble
@Kristeng2217 that's unfortunate and unwise advice. They still own the home, they are still responsible for the mortgage, they will be prevented from buying another home in the future unless they get their names off title to this home. A short sale is the only way they can sell the home to you.
They need to get a second opinion.
@Nicolemomof4 yes, your credit should be ok. Now, if you want to buy another home in the future, be aware that if you end up selling the home short (for less than you owe), that would trigger another waiting period separate from the bankruptcy.