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margorules · Joined: 10 May 2009 Posts: 1 1.97 Dollars($)

I filed Chapter 7 November 2008. I filed everything I had including my car and my house. I told my lawyer I wanted to keep my house. I was told that it was best not to reaffirm my mortgage. I have since been discharged of my debt.

The reason why I filed bankruptcy is because of my house. I am a first time home buyer single mother of three. When I purchased my home I was told what my payments would be that included my mortgage, property tax and homeowner's insurance. Based on that I knew I could afford to take care of my family and my bills.

Well two years later meaning 2008 (bought my home in 2006) I started receiving delinquency property tax bills. I didn't understand why because my property taxes were included in my mortgage payment. I contacted my mortgage company and was told that taxes were being paid. I was told to contact the assessor's office at that point. When I did I was told that Yes my property tax was not being paid and that I was to bring my deed to their office and we will go from there. When I looked over my deed I discovered that two PIN numbers were listed. When I went on the assessor's website to pull up both of the PIN numbers I discovered that one was paid in full and the other was delinquent. This is when I found out my house sat on two lots and that I was responsible for two property taxes. I contacted the mortgage company and after about a month it was straightened out and my taxes were paid. This in turn made my escrow in the negative by over $3k. When my mortgage payment was refigured to include the second property tax my mortgage payment went up by $500. I was unable to pay this an my regular bills and this is what forced me to have to file bankruptcy. What I don't understand is why the title company, my attorney at the time or the mortgage company was unaware of this or kept this from me. Had I known when I first was told what my mortgage payment would be to include the two property taxes I never would've bought this house could I would've known I couldn't afford it.

Now based on me not reaffirming my mortgage I can't get my loan modified or refinanced or anything. I'm struggling to make my payments and still support my family based on my high mortgage payments. At this point I don't know should I get an attorney as far as me being misinformed in the beginning as to my property taxes or as my original questioned stated can my house be taken because I didn't reaffirm my mortgage. Whatever assistance or suggestion anyone can offer I would greatly appreciate it. Thanks.

smithsussane

Hi margorules!

Welcome to forums!

Yes, you won't be able to refinance or get a loan modification as you did not reaffirm the loan. You do not have a personal liability to pay off the loan, so the lender won't let you refinance or help you with a modification. If you stop the payments, your house will be taken away by the lender. You can definitely contact an attorney and take his opinion as to what you should do. You may try to reaffirm the mortgage if that is possible. However, this would make you personally liable for the mortgage again.

Feel free to ask if you have further queries.

Sussane

Posted: Tue May 12, 2009 6:49 pm Post subject: Another question

Thank you so much for your response. Is there a downfall for being liable for my mortgage if I want to keep my house? I really don't want to rent again and oppose to attempting to get another house which I probably won't be able to since I filed Chapter 7, what other option would I have?

adonis · Posted: Thu May 14, 2009 12:23 am Post subject:

Hi Guest,

You will have to pay the mortgage dues, if you want to save the property from being foreclosed upon. As Sussane has suggested, you can contact your lender and check out if you can reaffirm the debts and start paying them off.

Guest

Hi Sussane,

We had a forbearance agreement with the bank(even though we applied for loan modification) . We were given 4 months at a reduced payment. Also we applied for Chapter 7 a month after. Have not received any reaffirmation with the bank. Do we have to reaffirm our current rate of 6.375? I am confuse as to why we have to reaffirm. If we reaffirm, aren't we locked at 6.375 forever.. we are hoping for loan mod.. concern if we reaffirm we may not be able to modify... please explain..

thanks

smithsussane

Hi M&M!

Welcome to forums!

Has your Chapter 7 bankruptcy approved by the court? Once the court approves your bankruptcy, get in touch with your lender and request for a reaffirmation. As far as I know, you'll be able to negotiate with your lender in regards to the terms and conditions of reaffirmation.

As far as loan modification is concerned, it will depend upon your lender whether he would approve it or not after you've filed for bankruptcy. You and your bankruptcy lawyer should talk to your lender regarding this.

If you reaffirm your debts, it would be easier for you to modily the loan. Reaffirmation of debts will make you personally liable for the mortgage dues and thus, lender would be ready to modify your loan. Loan modification and debt reaffirmation go hand in hand.

Feel free to ask if you have further queries.

Sussane

Guest

I am filing Chapter 7 but do not want to put my house on bankruptcy. Do I have to reaffirm? I am currently 3 months behind but can catch up once all my debts have been eliminated under Chapter 7. Will I be able to modify my loan if I reaffirm?

adonis

Hi Sasha S,

If you are filing Chapter 7 bankruptcy, you'll have to include all your assets. If you want to save your property, you will have to go for debt reaffirmation. You may even consider filing Chapter 13 bankruptcy. This will help you in eliminating your unsecured debts and you would get a repayment plan to pay off the mortgage within 3-5 years.

It will become easier for you to modify your loan if you reaffirm your debts. Reaffirmation will make you personally responsible for the mortgage dues. Unless you're personally liable for the debts, lenders will not be ready for a loan modification.

Guest

Sasha S,
Just reaffirm your home in Chapter 7. You will receive what is called an automatic stay. You don't have to make any payments on your home until your bankruptcy is complete. Start making payments then, and you will rebuild your credit. Later on, if you need, you may even apply for modifcation of the loan.

Guest

I am filed chapter 7 and my lawyer said I can keep my house but I should not reaffirm... What should I do. I want to keep my house and am ok with accepting the liability. Btw, is it really possible to modify the loan I reaffirm my debts?

Niicss

You should reaffirm the mortgage and keep on making regular payments in order to save the property from being taken away by the lender after your bankruptcy is over. Though your personal liability towards the mortgage payments is discharged, the lender still holds the lien on the property and has the right to foreclose the property if you do not make payments.

It is possible to modify the loans once you have reaffirmed your debts. If you can prove to your lender that your are facing issues in paying off the loan, he will modify the loan. In case, if you do not reaffirm, you won't be personally liable for the loan. Thus, the lender would simply foreclose the property if you face problem in paying the dues. He will not offer you a loan modification.

Guest

I was also told not to reaffirm the mortgage and the reason I was told not to is cuz if you can't make the payments any longer the house will be covered under your bankruptcy instead of being a foreclosure.

Can anyone confirm if that is true?

smithsussane · Posted: Wed Feb 24, 2010 12:42 am Post subject:

Hi!

Your query has been replied to in the given page:
http://www.mortgagefit.com/bankruptcy/discharge-addloan.html#152154

Take a look at it. I hope it will help you.

Sussane

Guest

Bank wants 4 weeks paystubs,do I still have a chance for a modification?

adonis · Posted: Wed Jun 09, 2010 10:33 pm Post subject:

Hi tom,

As you're unemployed right now, the lender will not consider your request for a loan modification. This is because you won't be able to pay the dues though your loan is modified as you've lost your job.

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