FHA Loan After Ride Through

[Nextgen]

Question regarding the mechanics of a FHA Loan after BK.

If possible I plan to ride through my home loan after C7. As I read the information if you stay current after BK, pay your bills, re-establish credit and have the proper down payment and loan to income level you can finance with almost normal rates with a FHA backed loan.

My question is the ride through on the home. If I continue to make payments, on time and then in 2 years decide to walk away, does the repossession of the home hit my credit again, even though the underlying contract has been discharged or does the clock start when my debt is discharged in BK?

In a perfect world, I would like to make payments for 24 months +1 day, find a new home, start the FHA home process, get approved, get closing scheduled and walk away from the old house (60-80k underwater due to housing collapse in OH)

Thoughts?

Edit: I should add, this is not an attempt to get something for nothing but I've talked to HSBC and they won't even entertain *any* refinances right now and my home is not FHA insured so I don't qualify for any of the federal refi/mod programs. I was surprised, when I contacted loss mitigation department and said I want to start working on something now they said, well your ARM does not adjust until November call back then... in other words, wait till you can't pay, even though you know you won't be able to pay...boggle.

[Nextgen]

Ok,

Forget the other details how about this.

If you ride through on a home, then later let it go, does your credit take *another* hit?

[lrprn]

If you ride through on a home, then later let it go, does your credit take *another* hit?

As long as you do not sign a reaffirmation agreement that the mortgage lender signs too and files with the court, then the answer is no and your credit does not take another hit. The original mortgage is included in the bankruptcy and if you are successfully discharged, legally you owe nothing on your mortgage and can walk away owing nothing at any time.

By continuing to pay after discharge (called a 'ride through'), your lender is deciding to allow you to remain in the home. Legally they do not have to - in almost all states they could repossess the house even if you make on time payments. But mortgage companies like the money coming in a lot more than having another empty property on their rolls bringing in nothing.

If your lawyer thinks you'll be ok to ride-through on your house, then chances are very good you can. And if you decide to walk away and did not sign a reaffirmation agreement, then you can do that at any time and owe nothing. Cool beans, eh?

[Nextgen]

As long as you do not sign a reaffirmation agreement that the mortgage lender signs too and files with the court, then the answer is no and your credit does not take another hit. The original mortgage is included in the bankruptcy and if you are successfully discharged, legally you owe nothing on your mortgage and can walk away owing nothing at any time.

By continuing to pay after discharge (called a 'ride through'), your lender is deciding to allow you to remain in the home. Legally they do not have to - in almost all states they could repossess the house even if you make on time payments. But mortgage companies like the money coming in a lot more than having another empty property on their rolls bringing in nothing.

If your lawyer thinks you'll be ok to ride-through on your house, then chances are very good you can. And if you decide to walk away and did not sign a reaffirmation agreement, then you can do that at any time and owe nothing. Cool beans, eh?

Thank you, just what I was hoping to hear. I love my home and would hate to leave but my builder is selling the same home 2 blocks away for MUCH less.

Thank you for the response