Need Help on Non-Reaffirmed Mtg through BOA in IL - Walking Away

[DustinLH00]

I am getting pretty confused after reading all of this information and need to get some clarification. My story seems confusing to me, so I am not sure how this all comes together. The facts are below, but basically Bank of America refused to reaffirm the mortgage and I have decided to move and want to make sure I am prepared for what is to come.

1) I filed Ch 7 in November 2009/Discharged March 2010. I reaffirmed on the car and 2nd Mortgage. BofA refused to reaffirm citing they do not do them. I reaffirmed on the 2nd mtg because it is held at my employer and only has $1600 balance, matures 12/23/10.

2) I owe $92,000 on 1st with BofA and $1600 on 2nd with my employer (a community bank). The 1st states Chapter 7 Bankruptcy on my credit reports.

3) The duplexes across the street went up for sale this week and they are the same size/specifications as mine. They are asking $82,000 out of the gate, so I am already $12,000 + Realtor Commissions upside down and probably more if they don't sell. Also, I need to spend about $9,000 to repair a flooding problem in my yard/crawlspace or will have to disclose upon sale.

4) Based on the negative equity, the non-reaffirmation, the flooding issue and the fact that I have a 45 mile (1 hour) one way commute to work/school every day, I have decided that I want to move closer to that direction and rent an apartment for a while.

5) My plan is to stop paying my 1st mtg effective 8/1 and stay here at least until October. I want to bank at least 3 mortgage payments so that I have money for the new apartment and to move. I will continue paying my 2nd as I have reaffirmed and want to keep my job. I plan on selling the appliances and half my possessions in the mean time to get additional money.

So, my questions are 1) they cannot attempt to collect the debt or touch my credit any further as the mtg was already IIB, correct? 2) does the foreclosure process go any quicker if you didn't reaffirm, as they know that you probably aren't going to pay if you miss one payment? 3) will I have to go to court or deal with any "process" or do I just walk away in October and move on? 4) should I tell BofA that I am not going to pay and will be walking? 5) will any major complications arise with the 2nd mtg? Given it's small balance and upcoming maturity, I figure not. 6) are there any other implications or things I need to be aware of?

I appreciate any help you can offer. I apologize for the long post, but wanted you to have all of the information.

[justbroke]

1) I filed Ch 7 in November 2009/Discharged March 2010. I reaffirmed on the car and 2nd Mortgage. BofA refused to reaffirm citing they do not do them. I reaffirmed on the 2nd mtg because it is held at my employer and only has $1600 balance, matures 12/23/10.

Okay... I won't say anything.

2) I owe $92,000 on 1st with BofA and $1600 on 2nd with my employer (a community bank). The 1st states Chapter 7 Bankruptcy on my credit reports.

It should list Chapter 7 and/or Included in Bankruptcy with a $0.00 balance.

3) The duplexes across the street went up for sale this week and they are the same size/specifications as mine. They are asking $82,000 out of the gate, so I am already $12,000 + Realtor Commissions upside down and probably more if they don't sell. Also, I need to spend about $9,000 to repair a flooding problem in my yard/crawlspace or will have to disclose upon sale.

Decision is getting easier at this point... unless your duplex is income producing...

4) Based on the negative equity, the non-reaffirmation, the flooding issue and the fact that I have a 45 mile (1 hour) one way commute to work/school every day, I have decided that I want to move closer to that direction and rent an apartment for a while.

Sounds good.

5) My plan is to stop paying my 1st mtg effective 8/1 and stay here at least until October. I want to bank at least 3 mortgage payments so that I have money for the new apartment and to move. I will continue paying my 2nd as I have reaffirmed and want to keep my job. I plan on selling the appliances and half my possessions in the mean time to get additional money.

You may be able to bank more if you're able to stay longer. Remember, you have to be in default and based on your State's foreclosure laws, they may not be able to even threaten to accelerate your note (call your note) until 90 days has passed. Then they must give you time to cure the default which is generally 30 days. I see at least 4 months.

So, my questions are 1) they cannot attempt to collect the debt or touch my credit any further as the mtg was already IIB, correct? 2) does the foreclosure process go any quicker if you didn't reaffirm, as they know that you probably aren't going to pay if you miss one payment? 3) will I have to go to court or deal with any "process" or do I just walk away in October and move on? 4) should I tell BofA that I am not going to pay and will be walking? 5) will any major complications arise with the 2nd mtg? Given it's small balance and upcoming maturity, I figure not. 6) are there any other implications or things I need to be aware of?

They cannot attempt to collect on the debt, but they can pursue foreclose. The foreclosure process can only go as fast as the process for your particular State. You are required to actually be in default and in most States, also have been threatened with acceleration as well as actually have had the note accelerated before foreclosure proceedings can commence.

You can just do nothing, you don't have to answer any foreclosure complaint. You can tell BofA just before moving to let them know that you are vacating and they may want to winterize and lock the place up. I don't see any complications with the second, if you actually pay them off 12/31/2010. Since this is your employer, you may want to make sure that's taken care of. I don't know the affects on your job if you don't pay the 2nd mortgage.

[DustinLH00]

Okay... I won't say anything.

Lol, I know. I wanted to reaffirm to keep the positive impact of the mortgage on my credit, thank the one above for them not letting me.

It should list Chapter 7 and/or Included in Bankruptcy with a $0.00 balance.

It does say Chapter 7 and a $0.00 balance. Just as my credit cards show, but nothing says Included In Bankruptcy. I didn't know if it mattered if it said that vs. just Chapter 7.

Decision is getting easier at this point... unless your duplex is income producing...

I only have one side so there is no income whatsoever. I am toying with throwing it on the market during this time just to see if anything bites. I don't really see that hurting anything while I am not paying, do you?

You may be able to bank more if you're able to stay longer. Remember, you have to be in default and based on your State's foreclosure laws, they may not be able to even threaten to accelerate your note (call your note) until 90 days has passed. Then they must give you time to cure the default which is generally 30 days. I see at least 4 months.

I wondered about that. We are talking about $900 every month that I stay I can put in savings. The new place is going to cost about the same since I am moving to the burbs and out of the stix. I really don't want to move with snow on the ground though, lol.

They cannot attempt to collect on the debt, but they can pursue foreclose. The foreclosure process can only go as fast as the process for your particular State. You are required to actually be in default and in most States, also have been threatened with acceleration as well as actually have had the note accelerated before foreclosure proceedings can commence.

You can just do nothing, you don't have to answer any foreclosure complaint. You can tell BofA just before moving to let them know that you are vacating and they may want to winterize and lock the place up. I don't see any complications with the second, if you actually pay them off 12/31/2010. Since this is your employer, you may want to make sure that's taken care of. I don't know the affects on your job if you don't pay the 2nd mortgage.

So, just to be clear. The mortgage line on my credit reports will not change from what it looks like today. They are not able to show me 30/60/90 days late? They are not able to put Foreclosed? I think this will have an impact on my ability to rent somewhere, so I want to verify.

I definitely want to pay the 2nd. I don't think they can fire me or anything, but I don't want to piss off senior management by not paying it back. If they don't fire you, they can make your life/future pretty crappy.

[justbroke]

So, just to be clear. The mortgage line on my credit reports will not change from what it looks like today. They are not able to show me 30/60/90 days late? They are not able to put Foreclosed? I think this will have an impact on my ability to rent somewhere, so I want to verify.

I won't tell you that they won't do that, but you should be able to get that corrected. It should continue to report as Closed, Chapter 7, $0.00 balance.

[mrskal]

I am in Illinois, about to go through foreclosure. My attorney gave me the timeline for Illinois, after 3-4 months of not paying, they will start the proceedings. He says it will take at least 7 months after that to actually forclose.

If it were me, and I was worried about the 2nd, I would probably pay that off since it is only $1600.

You have plenty of time to save, since you are still current on your mortgage. I would say, you wont be foreclosed on until at least spring, if not summer. My last payment was in April, I got a letter from the lender that they are going to proceed a week ago, and still nothing is filed.