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refinance after bankruptcy or brace for interest-hike

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krisarias Joined: 10 Apr 2010 Posts: 1 1.00 Dollars($)	Posted: Sat Apr 10, 2010 8:38 pm    Post subject: refinance after bankruptcy or brace for interest-hike Like 0 Dislike 0 This is a complex situation here. My husband and I were discharged from a Chapter 7 bankruptcy in June '08,and our attorney advised us not to reaffirm the mortgage. We've never been late on a payment, but we no longer receive statements, and the loan doesn't show up on our credit reports. Our adjustable rate, interest-only mortgage payment will rise from 6.625% which we pay now, to the prime index rate plus 2.75% in Nov. '11. Our mortgage was originally with Indymac, then Indymac Federal, then One West. (One West said right now they are not doing any refinancing) We owe about what the house is worth, and this includes an interest-only home equity loan at the current prime rate. To further complicate our situation, my husband and I are self-employed and own our own business. We love our home and wonder whether we should just reaffirm the interest-only mortgage (and brace for a payment hike in '11), or whether we should attempt to re-finance in the next year or so, maybe with additional money down.
adonis Joined: 22 Oct 2005 Posts: 10574 Location: ALASKA 1090.82 Dollars($)	Posted: Sun Apr 11, 2010 10:47 pm    Post subject: Like 0 Dislike 0 Hi krisarias, As you've not reaffirmed the loan, I don't think it would be possible for you to get a refinance as you're not personally responsible for the mortgage payments. You will have to reopen your bankruptcy, reaffirm it and then apply for a refinance. _________________ Procrastination is the enemy of your financial success
kris Guest	Posted: Mon Apr 12, 2010 8:36 am    Post subject: refinance after banruptcy Like 0 Dislike 0 Hi Adonis, Thanks for your quick reply. Assuming we decide to re-open the bankruptcy case and reaffirm, would you advise trying to refinance (with another lender, since One West is not doing any refinancing), or would we be best just paying the interest hike for another year or two, when the bankruptcy would be a few years behind us?
smithsussane Joined: 18 Sep 2008 Posts: 10439 Location: Alaska 985.83 Dollars($)	Posted: Mon Apr 12, 2010 10:21 pm    Post subject: Like 0 Dislike 0 Hi kris! Welcome back to forums! If your present lender is not ready to refinance the loan, then you can contact other lender for the same. It is always a better option to refinance the loan after 2-3 years have passed since you filed for bankruptcy. Sussane

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