Four days to discharge and now 2nd mortgage wants us to reaffirm

[lulabelle]

Now what? Our first mortgage did not send a reaffirmation agreement. Our second just faxed one over today and we are supposed to have it signed and returned by tomorrow! One person at the attorney's office told us not to sign the 2nd, since there wasn't one on the 1st, now a different person told us to go ahead since we aren't underwater. We owe about $210,000 on the 1st, $30,000 on the second and the house is worth about $290,000. Should we go ahead and sign the second? I'm afraid that if we don't, the second will find it beneficial to foreclose since there is equity in the house.

[BCA2009]

You need to find out your state laws regarding foreclosure. From what I understand some states won't let a bank foreclose if you are current on the payments regardless if you have bk'd the debt.

I suspect that they are just trying to bully you into signing, but won't do anything if you don't. But I understand that is a stressful decision to call there bluff.

If you need more time to make the decision you can sign it now and you still have 60 days to recind it. That would give you more time to research your options.

But at the end of the day, if you really do have that much equity, I guess it doesn't matter. Although most people over estimate the value of their homes in this market.

[lulabelle]

I looked up some of the information in our state, but to be honest, it's all Greek to me:

To entitle any party to make such foreclosure, it is requisite:

(1) that some default in a condition of such mortgage has occurred, by which the power to sell has become operative;

(2) that no action or proceeding has been instituted at law to recover the debt then remaining secured by such mortgage, or any part thereof, or, if the action or proceeding has been instituted, that the same has been discontinued, or that an execution upon the judgment rendered therein has been returned unsatisfied, in whole or in part;

(3) that the mortgage has been recorded and, if it has been assigned, that all assignments thereof have been recorded; provided, that, if the mortgage is upon registered land, it shall be sufficient if the mortgage and all assignments thereof have been duly registered; and

(4) before the notice of pendency as required under section 580.032 is recorded, the party has complied with section 580.021.

[pcn]

Many time the contract defines default to include filing bankruptcy. I would research that as well in your contract. That said, we received reaffirmation papers from our 2nd but opted not to sign.