does the judge make the bank (s) reaffirm?

[95kindebt]

Do the judges have the authority to make the banks raffirm the car/homes, or is it a case by case basis.

We've never been late on either of those payments.

Also, how does our 2nd mortgage (HELOC) factor into that?

Thanks a million....so many questions!

just worried we'll loose the house, and be on the street with 2 kids.

[justbroke]

A reaffirmation is voluntary, not only for the Debtor, but also the Creditor.

A Judge cannot force anyone, creditor or debtor, into a reaffirmation agreement. The Judge's sole purpose when it comes to reaffirmation, is to approve them if they are in the best interest of the debtor and that they are legally sufficient in wording (they require specific wording).

Also, how does our 2nd mortgage (HELOC) factor into that?

Are you reaffirming your 2nd mortgage?

[95kindebt]

we'd likely need to reaffirm the 2nd mortgage too. Never been late on either of them. Willt he attorney's tell you if you can be reaffirmed before it's a done deal?

[justbroke]

we'd likely need to reaffirm the 2nd mortgage too. Never been late on either of them. Willt he attorney's tell you if you can be reaffirmed before it's a done deal?

Yes, your attorney will ask for reaffirmation agreements. The creditors usually send out reaffirmation agreements before or at the 341 Meeting. This is because they need to be signed and submitted to the Judge before 60 days after the first scheduled 341 Meeting.

[mccaverty]

I'm sorry to bust in on this thread, but I just found out from my bank that "they never received reaffirmation documents" from my lawyer. My 1st and 2nd mortgages are included in my bankruptcy papers with the intention to reaffirm and I was discharged at the end of April. So is this a state-by-state thing where the bank is responsible for providing reaffirmation agreements?

At this point I'm waiting to hear back from my lawyer on this issue, but in the meantime I'm wondering if this is perhaps a blessing in disguise - a plumbing/heating company had a mechanic's lien on my house. I haven't heard a peep from them since discharge and I'm assuming that having not reaffirmed the mortgages they are at least second in line to receiving any compensation should I choose to walk away from the house? It's also possible that some of my assets (tax return) were distributed to them but the mechanic's lien has not been lifted so I sort of doubt it...

[justbroke]

I'm sorry to bust in on this thread, but I just found out from my bank that "they never received reaffirmation documents" from my lawyer. My 1st and 2nd mortgages are included in my bankruptcy papers with the intention to reaffirm and I was discharged at the end of April. So is this a state-by-state thing where the bank is responsible for providing reaffirmation agreements?

The way things are done in a particular District, is usually a District set of rules, procedure and policy. Generally though, the creditor is who sends a reaffirmation agreement, because it is basically a restatement of the contract terms.

These hardly ever come from your attorney. However, perhaps the lender sent them to your attorney, but he never did anything with them! There are a good number of attorneys who refuse to sign them (which is required).

At this point I'm waiting to hear back from my lawyer on this issue, but in the meantime I'm wondering if this is perhaps a blessing in disguise - a plumbing/heating company had a mechanic's lien on my house. I haven't heard a peep from them since discharge and I'm assuming that having not reaffirmed the mortgages they are at least second in line to receiving any compensation should I choose to walk away from the house? It's also possible that some of my assets (tax return) were distributed to them but the mechanic's lien has not been lifted so I sort of doubt it...

It's a blessing in disguise. Since you didn't reaffirm, you can't reaffirm any longer! One your case discharges, any reaffirmation agreements that weren't already scheduled before the judge (they don't have to be signed by the judge before discharge, only "noticed" by the court before discharge), are history.

[mccaverty]

Okay - so if I am already past the point of reaffirmation on my current home and I decide to walk away, how will that (or will it?) affect my future ability to get a home loan?

Edit: I guess I didn't consider the possibility of refinancing my current home? Is that possible, since reaffirmation is off the table?

[justbroke]

Okay - so if I am already past the point of reaffirmation on my current home and I decide to walk away, how will that (or will it?) affect my future ability to get a home loan?

Depends so much. You'd have to talk to your lender. If you're still in that home and have been paying on time... then that will be great.

However, FHA treats homeowners who surrendered or let a house go in Bankruptcy, the same as a foreclosure. So, you may have to factor that.

However, FHA and some other programs allow new home ownership in as little as 2 years after getting your discharge.

Because you're in that "ride-through" type of loan now... I can't be specific as to how you'd address a refinance. The problem with a refinance is that the home is underwater, right? It's worth less than the value of the mortgages? Yet, to satisfy the lien(s) on the home, you'd have to negotiate a short sale with the mortgage holder(s) in order to refinance. (The HELOC has a lien too!)

[mccaverty]

Well, in the current market - yes, it would likely be worth somewhat less than the amount of the mortgages (they are both held by the same credit union, so I'm not sure about a HELOC issue).

I am current on the payments - I've never been behind on them. Although I see the benefits of not having reaffirmed I am uncertain what my actual *rights* are as a "ride thru" mortgagee...obviously, I don't have the legal standing to sell the property, but am I still otherwise the legal owner? Or am I more of a "renter with intent to own"?

[StartingOver08]

[QUOTE=mccaverty;287517]Well, in the current market - yes, it would likely be worth somewhat less than the amount of the mortgages (they are both held by the same credit union, so I'm not sure about a HELOC issue).

I am current on the payments - I've never been behind on them. Although I see the benefits of not having reaffirmed I am uncertain what my actual *rights* are as a "ride thru" mortgagee...obviously, I don't have the legal standing to sell the property, but am I still otherwise the legal owner? Or am I more of a "renter with intent to own"?[/QUOTE]

You do have the legal standing as an owner. The deed is in your name, right?
You can sell the property anytime. The issue you have right now is 'property value' in relation to the mortgages. You have discharged your personal responsiblity for the repayment of the mortgages, but the mortgage lien is still recorded against the property, so if you were to sell it and the proceeds were not enough to pay off the mortgage(s), then you would either have to bring in enough money to clear the mortgage(s) at time of closing or arrange a short sale.

If you decide to stay and the market turns around the the value once again exceeds the mortgage balance, then you can sell normally.

Now, if you run into difficulty and have to give up your home because you can no longer make the payments, you can walk away if you choose and the CU/bank can not come after you for the deficiency because you have already discharged your personal responsiblity toward the debt when you were discharged in BK.

If you refinance, then you are making a new loan and you will again be personally responsible for the repayment of the loan.

[justbroke]

I don't have the legal standing to sell the property, but am I still otherwise the legal owner? Or am I more of a "renter with intent to own"?

Whoever has title to the property -- the name recorded on the deed -- is the owner. Your property is just "encumbered" by 2 liens comprising a mortgage/note and a HELOC.

You an sell the property, but you must satisfy the two lienholders (mortgage and HELOC) in order to transfer it properly (clean). You are not a renter.
You legally own the place!

[mccaverty]

Okay - thank you so much for clarifying...information is power!

[joh]

I had my 341 end of May and have not heard any thing from the lawyer
about the reaffirm. Both my 1st and 2nd are with Sun trust. I'm getting statements and they are report the loans as current. Is there any advanage
to reaffriming?

[justbroke]

I had my 341 end of May and have not heard any thing from the lawyer about the reaffirm. Both my 1st and 2nd are with Sun trust. I'm getting statements and they are report the loans as current. Is there any advanage to reaffriming?

Not if you can "ride-through". A ride-through is always the best position. That way, you get to keep the property, and walk away at anytime later, should you no longer want it. That's walk away without any lender recourse!

There are some lawyers who won't even sign these. (Lawyers are required, under the BAPCPA, to sign reaffirmations and attest that they do not pose an undue hardship on the debtor.) They reason that a reaffirmation is never a good idea.