Refinancing in 13

[TiredandWeary]

To this Poster and anyone else in Chapter 13; watch after your discharge - you may have creditors all of a sudden start listing in your "included in bankruptcy" comments with that account a "Date of First Major Deliquency" or "Date when First Deliquency Occurred." We filed in 4/02; some of the dates they started putting in were in 2007. When disputed, the CRAs advised us that the information was correct as reported that the account was being reported as being involved in bankruptcy. We have redisputed asking to have those dates removed. This occurred to accounts that did not have this information listed previously over the past 3 years. This is recent and we were discharged 1 1/2 years ago and the information should start coming off next spring (7 years). The change of dates, I was told, would allow the information to stay on 7 years from the date they listed as the Date First Major Deliquency Was Reported.

Be careful and observant...

Thanks for the tip, Flamingo! Sounds like more evil tactics to look out for! They find every possible loophole they can to really stick it to you! It's just wrong!!

[MotherTrucker]

One more caveat on the FHA loans that I have run into - if you live in Texas and have already done a cash out refinance on your home previously (I think the term is "Texas Cash Out Loan), the FHA lenders won't refinance your ARM. Texas has very specific and unique laws regarding home equity loans, one being that once you refinance as an equity loan, the loan must remain an equity loan until you sell your home. It's actually in the Texas Constitution. I confirmed this information with the Office of the Consumer Credit Commissioner.

We recently applied for an FHA loan, met all the requirements and were turned down for this reason. We are limited to 80% LTV and most lenders find Texas' requirements too burdensome, or at least that's what I've been told.

So, we're stuck in our ARM which adjusted to 10.85% last September and adjusts again to 11.62% next month. Our mortgage and car payments are paid outside of the plan.

We've had a rough path attempting this refi - we tried to use a broker recommended by our atty and found out we didn't have enough equity (because of the 80% LTV) to pay off the BK and all conventional lenders wanted it paid off. Then we tried to use my husband's VA loan benefit, and were told because we had 1 month of arrearage in the BK, we didn't qualify. Then we attempted the FHA refi and were turned down because of the type of loan we have. I've written and called my congressman, consulted other brokers, and I've gotten nowhere. We are now attempting a loan modification with our current mortgage co., so we'll see how that goes.

Just wanted to give a heads-up to anyone with a Texas equity loan out there...and if you have been able to refi in Ch. 13 in Texas, please send me the name of your broker!

[Elf]

I did a FHA re-fi one year in to my CH13 payments.

Payments had to be on time for a year, and I had to had an approval letter trom the trustee. Here's the issue- you can't have your payment raised by a dime. Your trustee won't authorize anything that might interfer with your perfect payment history. Don't ask to cash out. Just re-fi.

Lesson to others filing: Always pay your mortgage outside of the plan, and always pay your mortgage and your trustee. Eat hotdogs and beans if necessary. Always pay those two bills. No excuses are acceptable when you're in a CH13. Life gets really good on the otherside of this mess, but you can't get to that otherside if you default on either of these.

Elf

[Tribecca]

Refinancing in 13

I have an attorney friend who says he closes with people doing refis almost every week. We are in
NY. I'm doing a refi now, but BK Ch 13 has just completed. FHA is your probable only route for a new loan however - not bad, except for the MIP (Mortgage Insurance Premium) requirements. Take your time looking for a new loan. I have found that brokers are crooks almost everywhere. I've been burnt several times. Lied to, given wrong requirements just to add more fees. READ UP on the internet and don't trust any brokers as being fair and honest and economical. Also, there are soooo many scenarios you can use with new rates you finally decide upon - you can vary loan term, amount of loan, pre-paid interest (discount points) in order to strike a laon payment that matches what you currently have. In that way your Trustee should consider it a wash with no change in your personal expenses in the BK. Only diff is that you will have a lower rate (hopefully) and maybe a shorter term and placing more equity in your home as you pay monthly. Good luck. Yes, you can do this without much trouble as far as I know - at least in NY.

[holding on]

Sorry if this was answered before and I just didn't see it....

Since your trustee must approve any refi, what happens in ch13 refi and your mortgage payment gets lowered? will the trustee make an amendment to your plan and have your monthly bk payment increased since you now have more income?

[MOMof3]

Your attorney will have to file an amended plan if you want your payment to the trustee reduced. In our case, our payments to the trustee automatically increased to cover the cost of our adjustable rate increase. We will amend to bring it back to the amount it was confirmed at--maybe lower if our attorney thinks its possible. My guess is since the trustee has seen us pay the extra $300/mo since October, they will question that we don't have the means to do it--that is my concern, but our attorney thinks the amendment will be a slam dunk. We'll see!

Does anyone know what a "reasonable" brokers fee would be?

Thanks!