Our Wonderful, Friendly Mortgage Lender,....

[SinkingFast]

We finally got a good offer on our house for sale outa state. It's a contengent offer. The Buyer has to sell their home before they can buy ours. Both Realtors, ours and theirs, say the buyer's home is very nice, in a nice area. Our realtor said it's priced well. Both realtors feel it should sell quick. We know the buyer personally. He's the son of the couple that originally built the house. That's part of the reason the buyer wants it. The buyer's dad built the house about 4 years before he died.

We didn't make our January payment on our house outa state. Can't make February either. The savings are all gone. I had read on the Net, hearing nothing from you is worse with a mortgage lender than being contacted about what's going on. With a good solid offer on the table, we had hoped our Lender could work with us until we could close. So I called today.

45 minutes on the phone with a very nice young lady. When she didn't know the answers to my questions, she put me on hold while she checked with her supervisor. She said she didn't want to give me any incorrect information. Which I appreciated very much.

She asked all kinds of income and expense questions. Wanted to know about savings, IRA/401K's, etc. I told her the IRA was cashed out to pay off the HELOC last spring. She should have that in her records. Yes she did. Savings was gone having to keep up 2 house payments. She wanted our listing agent's name and contact number. How long the house has been on the market. Are we renting it out? A whole bunch of stuff.

She asked what we had planned to do with regards to not making the payments. I played dumb and said we didn't know. I didn't want to say we've been chatting with attnys because I didn't want her to put anything legal sounding in her notes. I told her we had reduced the price of the house again. The market was picking up and our house was showing several times every week. That we had been hoping to get an offer, and maybe the Lender would work with us. It's a good solid buyer, the offer is clean, they will pay all their own costs, it's enough to pay off the current mortgage, it's just contingent. Can they work with us on this??

Basically, the Lender won't help. They will not hold off on foreclosure to wait until we can sell the house. She said at some point we will receive a "Breach" letter. Then the loan will move to the pre-Foreclosure Dept. I asked how long before that happened. She didn't know. She said we can offer a DIL, but if we do, we are responsible for any deficiency. She also said we could check with customer service to see about making arrangements for a short sale. Again, we are responsible for the deficiency.

We just got the offer yesterday to sign and return. I don't know what to do. We can't, in good faith, fax a signed contract back when we may not be able to complete our end of the bargain. I don't know what to do and I can't reach our Real Estate Agent. She's out of the office right now so I have to wait until she calls me back.

Happy Valentine's Day. We just learned our Lender is a Sweet Tart, not a Sweet Heart.

[Minnymouth]

Are you presently in the process of bankruptcy????
Have you filed bankruptcy?

IF YOU HAVE FILED, and you sign some sort of papers with the lender regarding the home, you may quite possibly be liable for the balance due after your case is closed.

If you surrendered your home or waited on foreclosure, DO NOT SIGN ANYTHING stating you will pay for the balance due on the property.
If you are not planning on keeping the home - then include it in your list of crediors for discharge/

[SinkingFast]

We haven't actually filed BK yet. The attny wouldn't even take a retainer the other day. He had something for us to work on first. Get our one state refund back so we could use it to pay the other state taxes we owe. That was "under the table" advice. Once we get that done, we can retain him. If we retain him before we get the tax refund, the Trustee could push to have it included in the BK estate and pitch a fit about it being spent.

Because we are part year residents, TurboTax wouldn't e-file it. I called several tax people, got the same answer. Part year residents have to paper file. We got our taxes out via Priority mail on Friday, but I can well imagine it will be 2 to 3 weeks minimum before we see that refund check.

We hadn't told our Real Estate Agent any more than we've needed to as we've gone along. We kept the utilities turned on for months, to help with showing the house. We cut them off and then told the Realtor. She had a cow. But, I'm sorry, but that was costing us $100 and more per month. That's money we needed elsewhere. We haven't told our Realtor we weren't making payments or considering filing BK either.

But now this offer has come along. I hoped maybe the Lender would work with us and wait until we could close on the sale. Nope.

Trust me, Minny. We haven't signed anything or agreed to anything at this point. And won't later either, unless our attny says it's OK.

Hubby didn't wanna tell the Lender anything. He thought it might cause them to move faster than they might ordinarily have. I'm wondering now if he was right. Maybe that phone call screwed us.

But what do we do about the offer?? We can't fax back a signed sales contract when we might not be able to deliver.

[Minnymouth]

You did not say whether you had a a lot of equity in the home or not....
IF YOU DO NOT - then sign nothing..... if it doesn't sell, then let it go to foreclosure.

Bankruptcy can stop the foreclosure..........and the home would be included in the discharge....thus owing nothing on the balance after bankruptcy.

Be very carefull of what you sign from your lender..... If they even THINK you might claim BK then they may send papers for you to sign that state you will pay balance no matter what if they agree to work with you...... Don't sign yourself up for a terrible fall.... (advice - let your attorney look at the papers and decide from there) -- more than likely he will say "wait on refund - then file BK - especially since "foreclosure" takes a while...... They have to notify you of delinquence......send you a breach of contract (wait 30 days) then state foreclosure proceedings (thru the court).......... and yes all this can still be thrown aside thru bankruptcy if you should file within 2-4 months...

If they call, tell them you received the papers, and are discussing it with your spouse and will get back with them within 5 days on your decision in writing (the holding out game).... This will give you an additional week waiting on income tax refund. After they call again tell them you mailed those papers out on such a date and to let you know if they don't receive them..... (the holding out game).. After you have stalled them a couple of weeks your income tax refund should be on its way back to you...

Remember after you tell them that NO your not signing anything.....then they have to send you a notice of default, then a breach of contract letter, then notice of foreclosure proceedings - THEN they have to petition the Court to file for Foreclosure..... Sometimes this process can take several months. So you should have ample time to get your tax refund back and due what you need to do before filing for bankruptcy....

Good luck, keep us posted.

[SinkingFast]

Thanks for all the great info, Minny. We can use a lot of it.

Unfortunately, Missouri is a quick foreclosure state. 60 days for the whole process. AND,......... We have a "right of sale" clause in our mortgage. With a "right of sale" clause, in the state of Missouri, the Lender does not have to go the Judicial route. They can just start Foreclosure whenever they want. Or, whenever the Lender has satisfied all the notifications and attempts to collect payment requirements, is what I should say. The Lender only has to give us 20 days notice, by law, of their intent to invoke the "right of sale" and foreclose. Missouri is one of the quickest foreclosure states in the entire country. We just don't know when the letter of Breach will come that will put the whole process into motion.

I finally got to talk to our Real Estate Agent. She chatted with her Broker about what to do. They said send the signed contract back and act like nothing is going on. She said do not breathe a word of this to the buyer as he would probably just wait it out and buy the house at auction on the courthouse steps. She also suggested we drop the price again, more in line with the offer we accepted. The Real Estate Agents are gonna play a little head game here hoping that we win. Our agent knows another agent has a seriously interested, non-contingent buyer with cash or prequalified, I don't know which. But that buyer could close quick. The buyer is just sitting on the fence right now. They are hoping the price drop will pull the buyer off the fence to make an offer on our house. If that happens, it forces the kickout clause on the contingency and makes the first buyer have to do something, bridge finance or funds on deposit to buy our house, or loose the deal.

Also, our Agent has a friend that works inside our Lender's company. She's gonna call and see if her friend will be able to pull some strings for us, as a professional courtesy, to prevent the foreclosure from even starting. Maybe buy us the time we need to get the house sold.

If all this doesn't work out, and it even looks like foreclosure will start, we file and put it all in the attny's hands. No way will we sign anything that comes from the Lender.

We've left the house on the market for 2 reasons. 1) It would look better to the Lender if/when it came time to try for a non deficient DIL offer, and 2) we might sell before BK to be one less black mark on our credit afterward. Instead of helping, it's looking like we are getting caught in a squeeze play.

[Minnymouth]

I had heard that Missouri foreclosure laws were different than most states.

Sounds like your realtor has the right idea, if they can make it work...... Hope it does for ya!!!

Keep us posted on what's happening....

[SinkingFast]

I forgot to address the equity question, Minny.

At the current asking price we have NO equity. Once we pay off the mortgage, pay the Realtor(s), and doc fees, and such associated with the sale, there's nothing left.

I'd highly doubt this is gonna work. Why?? Because we are not lucky. If we had been lucky, the house woulda sold right away.

The Realtor has been faxing everything to Hubby at work. I signed the offer last night and handed it over to Hubby to sign. Then he handed it back to me. I asked him if he wanted me to put it in his truck so he wouldn't forget to take it back to work. It was a huge fax. 22 pages. Hubby says he doesn't really wanna do it at work. Would I take care of it?? I think no big deal. I've faxed stuff from a local copy shop before. So I say OK. I sent the fax at the copy shop today. When the guy got done, he rings it up on the cash register and says, "That'll be $25, please."

I didn't have enough money on me. I asked if I could go to my car and get my Debit card. Then I asked if they took Debit cards. He said yes. So I ran to the car, got the card, paid the guy, and nearly threw up on the way out the door of the copy shop.

Like every where I turn these days, I'm getting kicked. Blech!

[SinkingFast]

I'm not worried about credit reports. I've already cried over those. 25 years of paying bills and "Always Pays as Agreed" just went down the tubes.

I don't even care if the house goes back at this point. I was just hoping our Lender would work with us, and wait on this deal to go thru.

I didn't wanna sign a contract, and agree to sell the house to this guy and his wife, then run outa time, and have the house become a part of the BK. Basically, I didn't wanna sign a contract say I will do something, when quite possibly I can't.

[Minnymouth]

Sinkingfast,
If you have NO EQUITY in the home, let it go back in bankruptcy and save yourself a LOT OF GRIEF...... By doing this you will owe no debt on the home.....
Do not pay a Realtor to try and sell the home for you and be out the added expense....
Go ahead a file BK - surrender the home (since you aren't planning on keeping it) - believe me its not going to hurt your Credit Report as much as you think it will....
Let all debts be included in bankruptcy unless you have a vehicle you wish to keep....

I get the impression that you are worrying too much about bankruptcy....... your actions are making it more difficult to go thru......

File your bankruptcy (go for Chapter 7 since your not keeping your home, (save the extra money while your waiting on discharge - approx 6 months from day of filing...), get your creditors off your back and out of your face (including realtor)....

Believe me it will all turn out okay - if you'll calm down, be patient.

Talk to an attorney, find out your options.

Don't waste your money trying to salvage home to sell with no equity in it....

Its fairly easy to buy another home after bankruptcy.... I bought mine back the same day it sold at auction.... (the interest rate is a little high, but can refinance in less than a year for lower rate).

There is life after bankruptcy - you will see...... it will be so much better.....

Keep in touch, let us know what you decide to do....

[Minnymouth]

Regarding your credit report............it won't suffer as much as you think after bankruptcy with 25 years of good credit behind you saying "payed as agreed".......

My report suffered very little because of my bankruptcy..... I was amazed.... still had a 640 credit score after BK because of history......

So don't be crying over that credit score with your past history.....

Minny

[LostOne0069]

I'm not worried about credit reports. I've already cried over those. 25 years of paying bills and "Always Pays as Agreed" just went down the tubes.

I don't even care if the house goes back at this point. I was just hoping our Lender would work with us, and wait on this deal to go thru.

I didn't wanna sign a contract, and agree to sell the house to this guy and his wife, then run outa time, and have the house become a part of the BK. Basically, I didn't wanna sign a contract say I will do something, when quite possibly I can't.

I know how you feel.

Up until 3-4 months ago, we hadn't made a late payment in over 12 years. Then everything snowballed and hit us at once... bought a boat and a month into a major remodel on our house planning on doing it all ourselves over about a 6-12 month period... TWO DAYS after buying the boat a new job opportunity comes up at work... it gets us out of utah, which we've wanted to do for a long time... and a pay increase from $68k/yr to $90k/yr.

We even can take 3-4 months to get everything squared away before we move.... so I accept. Then, "oh, sorry, not 3-4 months... 3-4 weeks." so we have to spend in a month what we were planning on spending in 6-12 months. Of course we also have to pay some people to finish the remodel instead of doing it ourselves... so $30k gone in 1 month. Then, "oh, those $1200/month rentals you saw online were for 1000sq ft boxes with bars on the windows and bad neighborhoods, the best REAL rent you can find is $1650/mo... and everything else is twice as expensive as it was where you used to live also". Then, "sorry the house hasn't sold yet" and so we pay 1st & 2nd mortgage PLUS 1650/mo rent for 3 months. Then "well, it sold, but agent fees and costs ate up all but $3k of the selling price... oh and you have to pay the $900 property tax since it was due two weeks before you sold the house." Then, because of all this.... we end up missing a credit card payment... credit card immediately jumps to 31.24% intrest from 3.99%... oh and two other cards decide to do the same... even though you're not late on them yet.... then the snowball keeps going.

Then, last night.... my mom calls me to tell me my father has been diagnosed with prostate cancer... a very agressive form of it.

Sorry to rant and ramble in your post, I'm just really feeling it these days.

Life can really just jump up and bite you in the ass sometimes.

[SinkingFast]

Gosh, Lost. Your story sounds like ours only in a fast forward mode.

I know part of what's pushing the Real Estate Agents is the commission. They've worked really hard to sell our house and I can understand where they are coming from. But all the advertising,......... Well if it weren't our house in the ad, it woulda been another property. They woulda placed the ads regardless. And not selling a house is a risk they take in their business. Some you sell. Some you don't. That's just the way it goes. So I don't worry about them. Just if we could sell the house, that would be one less black mark on our credit against us.

I told Hubby last night I almost didn't fax back the signed offer. With our luck, the bank will start foreclosure, forcing us to file BK to stop that. Then the buyers will feign some sort of damages and sue us because they can't buy the house from us.

We can deal with the CC's pestering us. We have time there. The house is a ticking time bomb waiting to explode. We were just hoping the Lender would work with us so we could put more time between CC use and actual filing. Plus, we're having to wait on our one little income tax refund, so we can use it to pay the other state's taxes that we owe.

And the attnys all said, except one, it would be no big deal to file before the 90 days on charges. They were concerned about cash advances, but we don't have a problem with the $$ amount there. So what if we pay a little to this creditor and that one. But we have 9, that's NINE CC's, a little here and there starts to add up real quick. And then I see this:

http://www.bankruptcyforum.com/t5828...nt-offers.html

Cap One wasn't just after charges within the 90 days, they were going after the whole balance on the card. I can see our companies doing that. In the buying and selling of banks over the years that we've had the cards, we have 3 or 4 Chase CC's, 2 or 3 BOA CC's. And, of course, the infamous MBNA. The others are just sending a nice little note on this month's CC statement, "You might have forgot your payment last month. If you've sent it already, Thank You." Not MBNA. They sent a seperate letter.

It's just too many games to be playing all at one time. Oh, and can't forget we owe Uncle Sam $8K too. I think we should just sell the truck and pay that off, but the attnys say No, keep the truck. Get a payment plan with the IRS.

I'm not worried about filing. I'm looking forward to the time when we can file. Have all this crap behind us.

I know. I know. When we do file, a whole new bunch of "fun" begins.

[LostOne0069]

Yep, it sounds like our situations have a lot in common... we too have 9 CC's plus a line of credit... for a total of just under $100k unsecured debt.

I just keep reminding myself that after it's all said and done, I have 4 wonderful kids, a loving wife and decent health (if you don't count the stress)... and they can't take any of those away from me.

[Minnymouth]

You folks are stressing out too much!!!!!

Unsecured debt is just that - unsecured debt!!! This is mostly cc debt which is all dischargable in bankrupty (unless you have big fraudlent charges in the last 180 days - such as vacations, dirt bikes, big screen, etc)...

The only debts you really need to worry about are secured debts (loans against land, homes, cars, etc.) and most of these are worked out in bankruptcy or surrendered.

Taxes and childsupport and insurance claims against you are not dischargable.... these have to be settled in bankruptcy to be paid...

Contact you several attorneys, talk to them, find out what your options are - you will be amazed......

Quit struggling from week to week and trying to beat yourself up...... its not worth it.....

Things happen out of our control, and bankruptcy is a way to help clean it all up and give you a "fresh start" in life...

And above all - Don't worry about what people think!!!

Minny

[LostOne0069]

Minny, I appreciate the effort and thought... but what you say is much easier said than done. I'm used to being a "good credit risk" and having people call me a deadbeat (and FEELING like one) is very difficult.