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House balloon payment in Ch. 13?

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    House balloon payment in Ch. 13?

    Wife and I are 2 months away from paying off a 100% ch 13. House is in my wife’s name only, and had a around $3000 of mortgage arrears paid off early in the plan over 4 years ago. Now, my wife informs me that a previous modification she’d done with the mortgage company has ballooned at 5 years—leaving her with a $160,000 payment due—like now! We are looking at all our options. I have been trying to get an FHA loan in my name, and that looked promising until we had to show that my wife had made consistent monthly payments on the mortgage over the last 12 months. We can show that she has, EXCEPT for March ‘19, when her credit union suddenly stopped accepting payments—due to the balloon payment due, they would accept nothing less than the full amount.
    Now being told by the mortgage broker I was working with that not being able to show that March payment is likely going to shoot down my attempt to refi the loan (weirds me out to begin with that I could qualify to do a “refi” on my wife’s mortage—which she couldn’t qualify for due to bad credit score—yet still her payment problems are still a lynchpin of the deal.
    Anyway...bottom line after that little bit of background; wife wants to refile her own Ch. 13, and put the balloon amount in there. I do NOT want to refile. My credit is about to be rehabilitated and I”m looking way forward to NOT being under the BK court and trustee thumb. We NET around $10,000/month between the two of us. And I calculate somewhat loosely that a $4000/month payment would pay off the house in a 60 month plan. We were already paying $2000/m in current plan, plus $1100 for the mortgage. So in general, another $1000/m, which is doable for us. My understanding also is that though I would not file, the ability to make payments would be based on “household income.”
    I’ve looked this up online, and see where this type of large balloon payment thing has been done in a 13. Ran it by our atty last week and he just said “it’s not realistic.”
    Anyone have any experience with such a thing? Thanks in advance.

    #2
    Find another broker or ask your broker to still push your file. Your broker should be able to shop this around, and it's not as though that you weren't paying. Banks can provide explanations and still allow you to refi. I thought the FHA Refinance program was supposedly really fast.
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog


    I am not an attorney. Any advice provided is not legal advice.

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