AGH - Mortgage wants to work with us NOW

[jlynn275]

I'm so confused and my attorney is actually confusing me more (or her advise is conflicting with what I thought I read/learned here). HELP?

We applied for a mortgage modification or any sort of assistance in Sept. 2009 when we knew things were headed in a bad direction. Feb. 2010 we got denied the official modification program (name I can't recall) because we were like 1% away from the required Mortgage to income ratio. But my husband changed jobs right as we got rejected and took a HUGE pay cut. Too late for the one we already got denied on even though our situation was completely different.

They started the process in Feb. 2010 of looking for other ways to help based on our new income/situation. Have called bi-weekly ever since and nada.

Stopped paying both mortgages (80/20) October 2010. (we had only been late once - 2 months in summer of 2010)

Filed BK December.

Yesterday attorney gets a letter they want to work out something now and asking for permission to contact us.

It doesn't seem like there could possibly be enough time to do this before discharge and I don't want to put all my eggs in this basket and then not include the house in the BK because we "re-committed" to the mortgage by doing a loan mod. Attorney said that is how it would work, but I thought I understood that differently?? We definitely do not want to remain in the house long term, but don't want to be stupid either. I guess this is all premature until I see what they are offering, but can someone tell me if the "on the hook" thing is valid if we agree to a loan mod? Would we have to completely redo the original agreement or is that what a loan mod is?

[tyson24]

Just from doing a mod on my own home, I do know that you have to sign new loan doc's. I believe that would make you on the hook for the new mortgage note that you are signing, with probably a new int rate and payment. I was so nervous that we would be on the hook for that mortgage, I signed the paper that they could contact us, but knew that I would never start a mod process with them. My mortgage company is shady and I just do not trust them. The loan mod and the terms of that would be your new mortgage that would be signed for again and you would owe that debt outside of BK.

[jlynn275]

well that sucks. So can I see what they have to offer, still discharge current mortgages and then even if it's 4 months down the road sign a loan mod and re-commit if it's an offer I can't refuse?

[tyson24]

I am not sure. I am too nervous to even talk to them. I know that signing would be the only thing that binds me to the new to loan, but I am afraid of what constitutes "signing" lol...Just FTR, we signed that paper allowing them to contact us at our 341, which was on Nov. 8, and they have still not contacted us. They are sending us statements saying that our monthly pmt is $1900 and our old pmt was $1500. When I tried doing a mod before all this BK stuff came down the pike, they quoyed me at $4000...yeah see ya later This was Chase Mortgage.

[tobee43]

jlynn...we went thru the loan mod thing just about 1 year and then never responded.....actually it was the opposite in our case...our atty tried to work with our bank...they wouldn't hear of it....

so bk we go...surrendered the house...but we moved out within 30 days of receiving the summons since at that point we knew...even IF the loan mod went thru...when we applied we were both employed..then one of us lost their job and then by the time (and we were STILL in the process of the loan mod when we got served foreclosure papers!)....to make a long story short we left...moved 1700 miles away...waited filed in florida...and guess what.......after the discharge chase contacts us and says WE re-opened our loan mod........NOT!!!

ok...so here's what we learned...IF you want to keep the house then you may want to consider talking with the bank....however, i still would not do any written confirmation ...at all...do not re-affirm the mortgage...that way...if something happens at a later date, you are not obligated to the bank....but if you want your house...it may be worth it to speak to them ....however, if you are underwater (were are today to the tune of 200k on the house in nj)....then i wouldn't touch them with a ten foot pole...but the decision is YOURS and YOURS alone....

good luck!! can't wait to hear what you decide..

[debee]

You can do a loan mod without reaffirming the debt. Justbroke is in your state and he did it. Surely others have as well. Best of luck to you.

Link to a thread all about it: http://www.bkforum.com/showthread.ph...light=loan+mod

[tcreegan]

Hi all, Hi jlynn,

A loan mod after filing...the stakes are high, I would be running everything past an attorney before I signed....

The difference is modifying the original note which is discharged in the Bk, or rewriting/reaffirming the loan which puts you back on the hook.

Won't work w/ you, won't work w/ you, file BK, they come knocking on your door...how many times have we seen that around here?!!

A BK can be very motivating for a lender....

Tom in Colo

[jlynn275]

A BK can be very motivating for a lender....

most definitely!
I am not signing anything unless I understand exactly what's going on. And the offer has to be ridiculously good, which I'm sure it won't be...especially right out the door. At this point I don't want to keep my house long term, so the only thing I'm interested in is something that might delay foreclosure. My attorney says nothing will delay foreclosure, but that doesn't sound right to me. If they are busy working out a mod won't that keep them from working out the foreclosure? Or are there like 20 hands in the pot each contradicting the other?

[pathfinders]

Jilynn, Of course you can delay your Foreclosure, you can stay in your home in FL 1.5 to 2 years of longer before they sale the home. There are several posts on the board to show how to Ask the bank to prove that they own the note.

Go see a Foreclosure defense attorney for a free consultation. save up your money, If there is no equity in the home just let it go. The way prices are and will continue to fall in 3 years after the bank finally forecloses on your home you can more than likely fo FHA if you want and buy a home for about 1/3 of today's prices.

[pathfinders]

Jilynn

It of course looks like we are both from FL. stopped paying 10-2009..

[tyson24]

You can do a loan mod without reaffirming the debt. Justbroke is in your state and he did it. Surely others have as well. Best of luck to you.

Link to a thread all about it: http://www.bkforum.com/showthread.ph...light=loan+mod

I am sure that truly depends on who your mortgage company/loan servicer is. I am with Chase and you must sign all new docs to attain a mod with them. Or at least my backer requires that, not sure exactly how that works.

[debee]

I am with Chase and you must sign all new docs to attain a mod with them. Or at least my backer requires that, not sure exactly how that works.

Me neither. I would fall into the 'Hires a Lawyer' category. I agree that it depends on the lender. But there's hope, which I like. It's possible. Having to sign new docs in itself doesn't necessarily reaffirm the debt. This is the get-out-of-debt free clause from jb's thread/documents:

"Notwithstanding any of the terms of this Modification Agreement to the contrary, in the event that Borrower has received a discharge of the original debt secured by the Security Instrument on the Property and Borrower has not reaffirmed such indebtedness, Borrower understands, and Note Holder has so advised Borrower, that Borrower will not be personally liable for any amounts due under the Promissory Note and/or this Modification Agreement."

[tyson24]

Me neither. I would fall into the 'Hires a Lawyer' category. I agree that it depends on the lender. But there's hope, which I like. It's possible. Having to sign new docs in itself doesn't necessarily reaffirm the debt. This is the get-out-of-debt free clause from jb's thread/documents:

"Notwithstanding any of the terms of this Modification Agreement to the contrary, in the event that Borrower has received a discharge of the original debt secured by the Security Instrument on the Property and Borrower has not reaffirmed such indebtedness, Borrower understands, and Note Holder has so advised Borrower, that Borrower will not be personally liable for any amounts due under the Promissory Note and/or this Modification Agreement."

Oh I read it. I am not discounting that it CAN be done. You said "You can do a loan mod without reaffirming the debt" and I do not believe that is correct information. In certain instances you may be able to, like jb, but I do not think that it is the "norm" and that is what you made it sound like.

[debee]

Oh I read it. I am not discounting that it CAN be done. You said "You can do a loan mod without reaffirming the debt" and I do not believe that is correct information. In certain instances you may be able to, like jb, but I do not think that it is the "norm" and that is what you made it sound like.

Oh, I see. In my post I only said it can be done. I never meant for anyone to interpret anything beyond those words. Text is odd that way because you can't read tone. It's possible to interpret a meaning that's not there. I only meant what I said. It can be done. Don't assume it can't be done. Don't lose hope. You can do a loan mod without reaffirming the debt. It's possible. jb did it. Surely he's not the only one. Others must have as well. That's my message to the OP.

[tobee43]

Hi all, Hi jlynn,

A loan mod after filing...the stakes are high, I would be running everything past an attorney before I signed....

The difference is modifying the original note which is discharged in the Bk, or rewriting/reaffirming the loan which puts you back on the hook.

Won't work w/ you, won't work w/ you, file BK, they come knocking on your door...how many times have we seen that around here?!!

A BK can be very motivating for a lender....

Tom in Colo

tom, you are right on point here!!!!

it is so interesting when one has called the banks "bluff" if for a lack of a better word, and files bk and lists the mortgage.

seriously, we are still dumbfounded that our bank even approached us...after discharge yet.

i do think the banks motives are clear here tho, this country is so full of inventory, i know many banks don't want the property. i also understand some banks are more assertive with foreclosures (WF for example on this site many have stated they are right on top of it), while others , i.e. some with chase let it drag out forever.

personally, even IF and WHEN a loan mod came through at this point learning what i have, i still would never reaffirm it and of course as tom suggests. run it by the atty before you do anything.

once again best of luck, please post as update!