This is Odd (Mortgage)?

[ace300s]

My BK7 was discharged on June 4th. I used my free annual credit reports to check my credit reports. Thought it would be a good idea to check info before applying for a secured credit card. Everything looked fine except for a few minor errors (which I disputed).

One thing that did stand out on my credit reports was my mortgage with Citifinicial (changed to One Main). The loan and history of the loan is not on my credit reports. NOTHING! I stopped paying my mortgage in Dec 2011. I do have a car loan with the same lender and its on the credit report.

I have not heard anything from Citi since I filed BK7 in February. My plan was to try and work out a loan modification with citi after the BK7 was completed. Home is $75.000 underwater with a high interest rate.

Any thoughts? Should I contact Citi? Wait for Citi to make a move? Keep saving money while living payment free? I thought they'd flood me with foreclosure paperwork once the BK7 was completed....

[Drazil65]

Hi, me personally I would just live there free and save the money you need to move and deposits etc. Not sure why you would even want to pay for a house that is that much under water? I guess if you really want to stay and pay then I think you have to be current for the bank to even consider a mod. Can you get current? Its like 7 months of missed payments so you might just forget it and start saving the money! Good Luck!

[ace300s]

Hi, me personally I would just live there free and save the money you need to move and deposits etc. Not sure why you would even want to pay for a house that is that much under water? I guess if you really want to stay and pay then I think you have to be current for the bank to even consider a mod. Can you get current? Its like 7 months of missed payments so you might just forget it and start saving the money! Good Luck!

Thank you for the reply.....The only way I would stay in the house is if the principle (amount owed) was reduced along with the interest rate. Probably the chances of that are about zero? But you never know.

Any ideas why the lender (Citi) hasn't reported the loan to the credit agencies. I refinanced with them six or seven years ago. And why haven't they contacted me about the loan? Maybe they forgot about me or lost the loan (lol)......

[btbeme]

They will eventually catch up with you; however, until then, enjoy the free rent and the peace and quiet.

Do you have online access to your account?

[davetedge]

ace, some banks seem to be holding a "shadow inventory" of houses that they haven't foreclosed on to keep the market from collapsing. It sounds like a conspiracy but I keep hearing about stalled foreclosures and lost modifications so I'm beginning to believe it.

And an alternative theory: they may have lost your paperwork. It might be worth checking with your county register to see if Citi perfected the mortgage by filing all the paperwork. Have they sent any notices or bills at all?

[ace300s]

ace, some banks seem to be holding a "shadow inventory" of houses that they haven't foreclosed on to keep the market from collapsing. It sounds like a conspiracy but I keep hearing about stalled foreclosures and lost modifications so I'm beginning to believe it.

And an alternative theory: they may have lost your paperwork. It might be worth checking with your county register to see if Citi perfected the mortgage by filing all the paperwork. Have they sent any notices or bills at all?

Good idea on checking the county register. I'll do that. I'm just wondering why they never reported my loan to the credit reporting agencies (both past and current status). Citi brought my loan from another lender 7 or 8 years ago. I refi'd with them about 5 years ago. The loan has been brought and sold three or four times before Citi.

On Feb 1st they sent me a foreclosure avoidance notice #1 and on Feb 15 they sent me a foreclosure advoidance notice #2. The notices say California law requires the lender to contact me in order to explore options to avoid foreclosure.

I filed BK7 just prior to the 2nd notice and haven't heard from them again.

Am I correct in assuming the lender hasn't started the foreclosure process yet? I haven't recieved any other paperwork.

[davetedge]

It looks like Citi already started the foreclosure process, but it got paused by your bankruptcy. After Citi unpauses it, my understanding is things move quickly since CA is a non-judicial state.

I think its a good idea to contact an attorney who deals with foreclosures since there's been a lot of changes this year and CA got a Homeowners Bill of Rights. I don't know what that means, but I'd try and get a reduction in principal and continue living there rent free while you negotiate.

[ace300s]

I finally received a letter today from the lender. It says they would like to work with us to determine whether we wish to retain the property. It mentions possible alternatives to foreclosure. Also, says while our personal obligation to pay the loan has been discharged in bankruptcy, they are not attempting to collect this debt, nor impose any personal obligation on us to pay the debt.

Please call.......While no guarantees can be made, they believe it would be beneficial for all concerned to attempt to work out a resolution...

So, mortgage is $235,000 at 7%. Zillow estimates $170,000....

What do you think? Any chance they'll drop the principle and lower interest rate? I guess it doesn't hurt to ask. Maybe it will slow down the foreclosure process?