Bankruptcy

[deangelo]

My BK7 was discharged in Jan 2011, and my mortgage was not reaffirmed.  Since then I've been able to get my FICO back up to the 690's.

I decided in Oct 2011 to no longer continue to make the payments on my upside down mortgage, BOA has not reported any negative marks on my credit since the debt was discharged and not reaffirmed.

I'm considering accepting a Deed in Lieu of Foreclosure offer from BOA, and I'm curious of how this will affect my credit.  BOA has stated that they will report as "settled", and that would supposedly come off after 3 years.  Are they even allowed to report that, being that "settled" is a negative remark? Does anyone know how a Deed in Lieu would affect credit after a CH7 BK?

[pizzadude]

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deangelo wrote:

My BK7 was discharged in Jan 2011, and my mortgage was not reaffirmed.  Since then I've been able to get my FICO back up to the 690's.

I decided in Oct 2011 to no longer continue to make the payments on my upside down mortgage, BOA has not reported any negative marks on my credit since the debt was discharged and not reaffirmed.

I'm considering accepting a Deed in Lieu of Foreclosure offer from BOA, and I'm curious of how this will affect my credit.  BOA has stated that they will report as "settled", and that would supposedly come off after 3 years.  Are they even allowed to report that, being that "settled" is a negative remark? Does anyone know how a Deed in Lieu would affect credit after a CH7 BK?

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You have a FICO score of 690 with a BK reporting that's barely over a year old ?   Did you pull this score from myFICO ?

Did BOA state that they would remove the negative reporting of the Deed in Lieu after 3 years ??   If not then it will be a negative remark on your reports for 7 years.

It will definately hurt your FICO score, probably along the lines of a foreclosure.

[deangelo]

Yes, I pulled it from myFICO, it's the Equifax score. My situation may be a little different.  I was current on alomst everything before I filed, my score was over 700 when I filed.  I've have some credit cards that I use and pay off each month, including one that I've had for 18 years that did not close on me. I'm pretty sure these factors contribute to the 690 only 1 year and 4 months out.

So my question is really this, can BOA legally make another negative remark on my account since it has already been discharged? The negative mark being "Deed in Lieu" or "Paid Settlement". I would think not, just like they cannot make any remarks about my recent lack of payments.

[pizzadude]

So your mortgage was included in the BK, but BOA never took the house back ?  Did they note the Mortagage on your Credit Reports as having been included in BK ?  You kept paying for 8 or so months after you filed,  is that correct ?

[deangelo]

Correct, the mortgage was included in the BK7 and discharged. It is currently reported as dischared in BK, with $0 balance, but not closed.  I continued to pay for a while to aviod a foreclosure because I was not sure if I was going to move.  Once I decided that I needed to move, I stopped making payments (Oct 2011). 

So now, if I accept THEIR offer for a Deed in Lieu, are they allowed to post the negative remark of "DIL" or "Settled" on my credit?  My understanding is that once the debt is discharged the creditor can no longer make negative remarks on your credit.