Need Clarification, foreclosure, non reaffirmed mortgage

[IllinoisLiz]

there is a great site that is similar to this one but focuses on foreclosures. You can find a ton of answers and great supprt there. google loansafe. sorry i cant post the link.
good luck to you!

[tobee43]

Sorry one more important question - Since we did the HAMP Modification, aren't Freddie Mac/Fannie in "charge" of our loan? It says their names on our Mod paperwork, along with the banks name of course. I'm thinking that this may slow down the process a bit, especially with everything that's happening with the Obama admin this week specifically regarding these loan modifications. Any thoughts on that?

freddie mac and fanny have banks handle the loans they are just government backed, however the lender still services them.

it just depends on how fast the foreclosures are going in your area. shoot, our house was an FHA with PMI and it still hasn't foreclosed and it's over 4 years now. we don't live there anymore and the bank has taken it back, however, they have not made one move to foreclose and here it's a government back loan with insurance. so, really, one can't tell how quickly it will go, or better said how quickly they will move. a good way to find out is; i know in nj we can just go to the county site and it lists the foreclosures, i don't know how exactly NY state does it. i would see if there is anything on your country site about the lists of the bank foreclosures that way you can see exactly how quickly or slowly they are moving in your area.

seriously, i don't know if we were still in the house if the bank would have moved quicker in our situation, but even so, over 4 years is very slow in that area, yet the nj shore they moved much quicker.

[SMinGA2]

1b3, that's a different situation than paying for continued use of secured property. For something like a home or car - you keep paying to keep the property. If you don't reaffirm, they can't pursue you for a balance owed if you stop paying. At some point you would lose access to that property though. (Thru foreclosure or repossession.)

[1b3long2u]

Maybe you can get that money back that you've been paying to them?

Question - you indicate you didn't file. (So your spouse did, I assume?) Is your name on the home loan?

I wonder if it is possible to get all of the money back that you've paid the mortgage company since you filed BK? I got some money back from a collection agency that had garnished my wages just prior to me filing BK, it was considered a "preferential payment" or something like that?

[murphsmom]

Sorry one more important question - Since we did the HAMP Modification, aren't Freddie Mac/Fannie in "charge" of our loan? It says their names on our Mod paperwork, along with the banks name of course. I'm thinking that this may slow down the process a bit, especially with everything that's happening with the Obama admin this week specifically regarding these loan modifications. Any thoughts on that?

[murphsmom]

He may have marked the intention to reaffirm during filing, but by no means signed an actual reaffirmation agreement before discharge/closing. I'm fine with receiving the notices, and understand that it's procedure. He absolutely didn't mark "surrender" because it we did intend to stay and pay. The mortgage shows "discharged" on his credit report, and I'm certain he didn't reaffirm. Also can't find anything in the HAMP mod that states anything about a future bankruptcy, applied reaffirmation, etc... The HAMP was a done deal, no more processing of the mod, as of May. He didn't even file til July. Never got any notice from the bank until early Feb, after we had missed a couple of payments.

Now, I just wish I knew how long this would take... That's the stressful part. Yes, they are a smaller credit union that will move faster (most likely), but since it's a judicial state, they still have to go through the process. The range of how long is what's questionable, 5 months? 2 years? Who knows??

If we had 2 months between the notice of the fire sale date, and the actual sale, we'd probably be OK with whatever. I just don't want to get a notice 4 months from now that states we have a week to get out, but I guess that's the chance we take.

[tobee43]

even though the mortgage amount was discharged in your bk, did you mark surrender, retain, reaffirm, other?

by marking retain, the bank expects you to keep up the payments like a pay and stay even if the mortgage was listed.
if you marked surrender...then they can move to foreclose and have you forced out at some point, however as one of the other posters pointed our NY is in fact a judicial state and it will take some time for the lender to go through the process.
if you marked reaffim most likely someone had you sign a document obligating you to the debt. (i'm sure you didn't do that one).
other could be a number of things...i.e. still processing a loan mod etc.

the point here is the lender since the bk is now discharge has a right to pursue the property if it theirs, so you will continue to receive those notices until the final days of you having to leave.

[SMinGA2]

Sounds like a standard notice there. They have to go thru certain steps in the foreclosure process. But it also sounds like this is just the beginning.

[murphsmom]

Just got a NOTICE letter, says we need to pay amount in full by March 9th or they will acquire our property by means of foreclosure. #8 on the long list of what our rights are says "If you have received a bankruptcy discharge this letter is not an attempt to collect the debt, but you will need to pay the total sum due to avoid foreclosure".

[sh9730]

Murph,

Ok, just a couple of other points. I cannot imagine the bank was not notified of the BK filing - unless you didnt include them on your original filing - which I doubt happened. SO, they ARE in violation of the discharge. HOWEVER, if you push this point in your situation, it leaves the bank the only option to start official foreclosure process immediately since they cannot contact you with "normal" (phone calls etc..) collection activities. If you just let it go...you may buy yourself some more time, BUT it will be more stressful since the calls etc will continue.

SO, you could push them on the violations (and if they continued after that you could get some money out of them), but that might get you foreclosed faster.....

[murphsmom]

My name is not on the home loan, deed, title, anything. He's the only that filed.

The bank has called us DAILY for two weeks about paying this mortgage. The first letter we received last week said if we don't pay in full in 90 days from the date of the letter, they would begin proceedings. Got a letter today stating that if we don't pay in full by March 1st, they would start proceedings. Already they are contradicting themselves.

I know they aren't supposed to call, and honestly, I do not believe they are even aware that it's been discharged. They never even sent reaffirmation paperwork to the court when we filed, and haven't mentioned a single thing about the BK, or asked us to reaffirm now. I'm thinking this may work in our favor somehow. I'm not going to mention it, I'm going to keep their voicemails and contradicting letters and ride this out.

We decided today that it's fruitless to try and get caught up at this point. Husband got another job but can't start for one month. We're going to pay down some of my debts to put us in an ever better position for me to qualify for a mortgage next year, or whenever they throw us out.

I guess there is just no knowing how long that will take.... my biggest concern is having any amount of time to get out once we get notice. They need to notifiy us of the Sherrifs sale, correct? And usually how long from the time you receive that letter until the sale takes place?

Thanks for all the input. This will be stressful, but not as stressful of paying a mortgage we can no longer afford and living on Ramen for the next year.

[SMinGA2]

Question - you indicate you didn't file. (So your spouse did, I assume?) Is your name on the home loan?

[btbeme]

NY requires judicial process to foreclose, and that will take a while. I'd expect to be able to stay a year or more. Quite frankly, if you were able to bank the money instead of paying a mortgage for 12-18 months but were booted out with little or no notice after that, you could easily afford a month-long stay at a Residence Inn while you found a rental. In the meantime, let the bank do its own homework. Should you later get served with a 1099 or a lawsuit, you can clear it up with a copy of your discharge order.

In a non-judicial state (mostly in the western US) foreclosure can be done in as little as 3 months, with 6-9 being more typical. In those cases I urge folks to stretch the timeline by applying for a loan mod, and then maybe a short sale. In a judicial state, however, since the timeline seems so much longer anyway, I'd say just stay until they give you a notice to leave...and even then I'd ask the realtor or the new owner for a "cash for keys" type agreement to leave quietly.

A side note - are you attached to living in NY? With a Ch 7 discharge, absence of a mortgage, and loss of a job, that would seem a great time to leave an incredibly expensive state for a different (cheaper? warmer?) venue, unless of course there are other factors. Just asking, nothing against NY...

[sh9730]

Agree with most if you have made decision to go. You are safe because of the discharge. NOW, you say you dont think the collections department is aware of the discharge? THEY BETTER BE!! Against the law for them to try and "collect" this debt in any way. Now, they can notifiy you that they plan to start foreclosure proceedings on their security interest, but they shouldnt be calling you or anything like that.

[shark66]

Does it matter if my bank is a smaller local credit untion, not a huge mammoth national bank? I'm wondering if the length of the whole process depends solely on the bank, or also on how busy the courts are?

A smaller bank/CU will move much faster than the large TBTF one in my experience.

Having said that, nothing gets done fast in NY, apart from an assassination here and there......only because there's no bureaucracy involved in those...

Good luck to us all.