Need guidance about Mortgage/ selling/ reaffirming.

[tjw0783]

I filed Bankruptcy in November 2010, it was discharged that same month. I had included my mortgage, after discharge I did not reaffirm.

I have conituned to live in the house but payments are 60 days late. (never caught up because wasnt sure I wanted to stay). Fast forward to today and im looking to get a new mortgage. My head is spinning becuase I have read and been told so many different things when it comes to getting a new mortgage. 

I would like to try and sell the home if I can. I have been told that I can only get a new mortgage after the deed has been taken out of my name for 3 years. I just dont understand the logic in this if im able to sell it and not give it back to the bank. This wouldnt be a forcloseure or deed in leiu. It would be me selling it. Is it still a 3 year waiting period for SELLING the home and getting a new mortgage?

Im also looking at the option of reaffirming. If I caught up payments and called the mortgage company and let them know I would like to reaffirm, does that change things when it comes to getting a new mortgage? Would I still need to wait 3 years after reaffirming? Also, would the past late payments show on the credit report or do they start reporting from the time I reaffirm? 

If anyone can shed some light on this situation I would really appreciate it. 

Also, Im in ohio if that makes a difference and would most likely do a conventional loan since im pretty sure FHA is out of the question. 

[StartingOver10]

First of all, a bk takes longer than 30 days. It isn't possible to file, have your 341, and receive your discharge all within 30 days.

You can go to PACER.gov and download your entire bk file so you have all the dates and documents.

It is too late to reaffirm your mortgage. In order to reaffirm, you would have had to do so within the bankruptcy.  It doesn't matter though. If your bk has been successfully discharged and closed you are free to sell your home.

If you do successfully sell it then normally you could go out and get an FHA mortgage because it has been longer than 2 years since your discharge (using Bk derog info with no foreclosure).  For a new conventional loan it would be 4 years from the discharge date if you have a successful bk discharge and no short sale or foreclosure. FHA has shorter time requirements after a major derogatory and conventional loans require longer time frames.

The issue I see with you getting a new mortgage is that you have been consistantly 60 days behind since discharge. Normally when you have a bk you have to show that you have been making ontime payments manually (show bank statements or cashed checks for ontime payment) since the payments aren't reported on your credit report.

Consider getting caught back up and paying ontime for the next 12 months and then selling your home so you can show proof of ontime payments for 12 months. That might work.

[grassfeeder]

agreed with the above....underwriting is going to want to see all of your payment history on your current place and those 60's are a MAJOR red flag.  I'm in a similar situation as yourself, just awaiting on coming up on my 2 year post discharge and have been saving my payment history since even before my filing BK.

[tjw0783]

Thank you for the information. I double checked my BK paperwork and it was filed in August discharged in November. 

I do plan to catch up the mortgage. I would have to sell the house first correct and then apply for a new mortgage? I suppose I would have to rent for a few months after selling until I found a home I would like to buy. 

[StartingOver10]

Yes, you are going to have to sell prior to buying again unless you qualify for two mortgage payments. You probably will have to have a large down payment as a compensating factor if you can only show a short period of on time payments (12 months or so). Or you can sell and rent and show ontime rent payments. They still may ask to see your mortgage payment history from you and as pointed out, rolling 60's is a major red flag. So before you consider putting your house on the market, get caught up and pay ontime.

[tjw0783]

Thanks, It wil be sometime next year probably late summer at the earliest before we will be putting the house on the market. We have some updating to do in a room or two before we can list it for sale. So we will have atleast a year if not more of ontime payments showing.  

I was just really confused as to all the info I had recieved from various people about the deed needing to be out of my name for 3 years before qualifying for a new mortgage. 

[ezdriver]

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@tjw0783 wrote:

Thank you for the information. I double checked my BK paperwork and it was filed in August discharged in November. 

I do plan to catch up the mortgage. I would have to sell the house first correct and then apply for a new mortgage? I suppose I would have to rent for a few months after selling until I found a home I would like to buy. 

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I assume that you were underwater at the time of dicharge of the mortgage. You will need to cooperation of the mortgagor to sell so you can be released from the deed. The property remains the mortgagor's collateral so you cannot sell the home without the mortgagor's approval. Is there a reason why you have not tried a short sale yet?

[tjw0783]

Ezdriver- no, not underwater. Actually owe quite a bit less than what the house is worth. I would like to sell because I'd stand to make quite a bit from it instead of just walking away, dil, etc...

[StartingOver10]

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@tjw0783 wrote:
Ezdriver- no, not underwater. Actually owe quite a bit less than what the house is worth. I would like to sell because I'd stand to make quite a bit from it instead of just walking away, dil, etc...

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Well, that is good news! Sell it when you are ready and use the equity to buy another if that is what you want to do.

The good thing is this:  once you catch up in your payments and remain on time for 12 months you should then be able to qualify for  a new mortgage. You are well past the 2 year date from your BK discharge that the u/w's look at - but they still have to check your payments. That is the only reason I am suggesting to wait a bitd so that you can show 12 months of paid on time history to the u/w when you get your new loan. Plus you will have the funds from the sale of your home as a compensating factor (lower the LTV, less risk for the new lender on the new mortgage).