In need of professional advice !!!

[katt3344]

Ch 7BK discharged March 2009, house included and not reaffirmation agreement signed. Now having issues finding rental due to credit, BK, and pets. So, we're rethinking trying to stay here just a while longer until we can buy another house. Foreclosure filed 08/2011, mediation 12/2011. Bank wanting us to pay past due pymts from the date we stopped paying, plus taxes, late fees, and attys fees to the tune of about $20K over the next 12mos ALONG with our regular mortgage pymt. But, nothing mentioned about reaffirming. Also, we have been trying to buy another house as we have rebuilt our credit and have a large chunk of money in the bank, but the banks keep telling us we are denied because we don't have 2-yrs payment history because we stopped paying our mortgage 11/2010.

So my questions are 1)Is it truly an FHA guideline you have to prove 2-years recent payment history to qualify for an FHA loan? 2)Do you think it would be possible the bank would be negotiate a different payment plan with us (thru an atty of course) that DOESNT include atty's fees and for a longer term? and 3)If your mortgage was included in Chapter 7, but you stay in the house and pay off the loan, do you eventually get the deed? Do they legally have to give it to you? (this one's for my dad).

Thanks!

[btbeme]

How about some non-professional advice?

1. Yes. FHA guidelines ask for a two year history of adequate income, assets, and spending, so mortgage payments absolutely fit under that guideline. In fact, they may well ask for the last two years of paystubs and utility bills as well, no gaps. They want to know whatcha got, where it came from, and where it is going. Also - just because the guideline says you qualify after two years that doesn't mean that they WILL do it. This is what a lot of folks are finding out around here. Some of the time it has more to do with the market rather than the person. Since FHA will loan with 3% down, that leaves them very little margin for a market that could drop 5% in a single month. But mostly it is because FHA wants to see two years of absolute model behavior.

2. I wouldn't pay them squat. Have you tried a HAMP modification?

3. Yes. But that would mean paying the bank every cent they want, including penalties, etc before they will quit the lien on the deed (And they must do so within the timeframe your state requires or they can face some very stiff penalties).

You say you have a chunk of money in the bank. When we went hunting for rentals, we simply said that we would be able to pay them whatever deposit they asked to make them comfortable with our pets and our financial issues. Cash talks. And, sometimes you may have to settle for less than you want in order to get a roof and ride out the storm, unfortunately. Then again, I know someone who negotiated a one year stay at a Residence Inn for about what they would pay for renting an apartment.

[justbroke]

I had no problems renting the places that I wanted -- including a corporate apartment -- after my Chapter 7. Try Criagslist but be very careful with who you are dealing with. Ask for references and definitely check the county court clerk's website to see if the place is in foreclosure! (You may be surprised how many are in foreclosure.) There are plenty of rentals out there even with a BK!

Even the management companies only require a year post BK and good scores to rent! There must be another problem (which may simply be pets).

[katt3344]

Thanks for the rplies.

As far as finding a rental, the mgmt cos are the ones telling us that the LL sets the criteria of credit and if they allow pets. And, because we have 4 kids we are looking for a big 4BR or a 5 BR hse. So far they hv all said no pets and no BKs for 5 yrs. The way Im looking at it is if we can negotiate with the bank to repay our arrearage, stay for a few more yrs to rebuild our credit until we hv a pymt history, then we can buy another house. We would be throwing away money in rent anyways. This way we can keep the kids in same schools, we know the house, and we can keep our pets. I have a call in to our atty handling the foreclosure case and shld hear back today so I will keep you posted!

[justbroke]

Well, the company I used said no BK unless discharged for a year. I applied 1 month after discharge and was approved! I don't know which management companies in Florida that you talked with, but that is not the norm (5 years)! The norm is 1 year post discharge with re-established credit. As I must wrote, some ignore it if your credit is good and you have the right income.

I have found 4 and 5 bedrooms homes in Florida for rent with much better criteria. I would start looking at Craigslist but make sure you do your due diligence.

Please don't try to keep the home for the sake of your credit! You are better off dumping the place and starting 'fresh" somewhere else! You have no guarantees that the bank will even start reporting to credit bureaus and the fact is that until you pay off the arrears, you will still be behind (and reporting late). Now, the interest paid is a nice tax deduction, but I wouldn't keep the home and pay the arrears for a credit score.

Please never put yourself in financial jeopardy in order to preserve your home for comfort. You could end up making it worse by not being able to provide basic necessities for your family. If I were a kid again, I would choose food and clothing over going to the same school anytime.