@securingourfuture wrote:
@Anonymous wrote:
Hello,
If you have a approved Re-Affirmation agreement with your mortgage company they cannot kick you out of your home. Hopefully your attorney reviewed your paperwork and once your BK discharges you should be fine to continue your mortgage payments as you were before the BK. I have been seeing alot of creditors no longer reporting accounts that have gone through the bankruptcy process whether they are re-affirmed or not. I was reading an article that said companies were getting fined for not reporting balance information accurately during and after the bankruptcy process so in an effort to prevent these errors they began removing the account from all credit bureaus. This really sucks because all your hard work trying to keep your mortgage current wont count towards your credit rebuild. Refinancing at a later time may be your only way to have your mortgage payments reported. Good luck on your rebuild.
Thank you for responding. I don't have a reaffirmation agreement signed, but I told the Court I would reaffirm and I let the mortgage company know I would reaffirm. Today, I just found out that, even with a reaffirmation agreement, they don't report for the life of the loan. Only after the loan is closed will they report the payment history. The rep told me to keep good records and they would follow the usual protocol with ability to make payments online, any missed payments, default, etc. So now I'm wondering if I should even sign any reaffirmation agreement at all.
Well, that's about the most stupid attitude from a lender I have encountered. You are doing them a huge favor by reaffirming the mortgage. Most time when you reaffirm you need to make sure you have it in writing that they will report the reaffirmed loan payments.
Here are your choices:
Reaffirm the mortgage:
- No reporting of your payments, no benefit to your credit report/score.
- You remain personally liable for the full amount of the loan. I don't know how long you have paid already or if you have equity, but if disaster strikes - another 2008 financial crises hits and the value of your home falls drastically or you lose your job and can't make payments and they foreclose you are financially responsible for any shortfall, what they sell the house for minus your current balance which will include a bunch of fees - late fees, maybe high penalty APR, attorney fees, foreclose & selling fees.
Don't reaffirm the mortgage:
- No reporting of your payments, no benefit to your credit report/score. As with all other debts discharged in your BK (I assume you're filing Ch.7?) they will remain in your credit report as a negative item (IIB, Included in BK) for 7 years.
- You are no long personally liable for the loan, the debt is discharged in BK. If for whatever reason they foreclose all they get it is the property, end of story, if there is any shortfall in what they sell the house for that is their problem.
If it were me and the lender told me they won't report my payments if I reaffirm I would NOT reaffirm.
In my 2010 BK7 I did not reaffirm my mortgage, and I still pay the mortgage and live in the home, I was never late before, during, or since the BK - but no one knows that but me and the bank, because it just reported IIB like my CCs included in the BK, and they all fell off my credit report last year at the 7 year mark. I didn't refinance because the rate & terms of the mortgage are good and because the property can be hard to get convention mortgage now as it's a 10 acre rural property with manufactured home. But I did get a Home Equity Line of Credit last year, so now I have a real estate loan reporting again, helping round out my credit profile.
Think it over, and remember reaffirming is in their favor, not your, and if they won't report your payments under reaffirmation it's even less in your favor to reaffirm. And no problem that you "told the Court" you would reaffirm - that's only a statement of intent to reaffirm, and you are free to change your mind. I also filed with intent to reaffirm, my attorney talked me out of it.
