Home loan reaffirmed paper signing?

Anonymous · ‎10-14-2019

At what point does this take place (time line)? All of my accounts have been zeroed out on my credit report so far and I'm in week two so far. I called my loan service company to set up payments and they said unless the loan is current, they wont sign the reaffirmation paper work. Trying to see how fast I need to get current on my before this becomes a bigger problem. I live in California if that matters and i believe my discharge date is set for Jan 10th.

FireMedic1 · ‎10-14-2019

The sooner the better. This should have been worked out with your lawyer beforehand when you filed. Its best to ask them.

Does this look familar?

https://www.uscourts.gov/sites/default/files/b_240a_0410.pdf

Anonymous · ‎10-14-2019

I haven't filled that paper work out yet and I just got word from him that this will take place around 60 days from the day I submitted. I'll have the account current by then. Thanks for the reply!! This site is very helpful during this stressful time.

Anonymous · ‎10-14-2019

Perhaps this is a silly question, but:

Why do you want to reaffirm the mortgage? If you're able to make the mortgage current and keep it current, could you keep the home by not reaffirming? If so, wouldn't that be better than reaffirming your liability on this debt?

Anonymous · ‎10-15-2019

If I want to keep the home, the loan needs.to be reaffirmed.

FireMedic1 · ‎10-16-2019

Without knowing everything that is going to be DC'ed. Some folks have all their debt wiped out and then they can pay the motgage without lates and so forth. And keep their biggest investment in life. This is why many decide to reaffirm so it reports to the CRA's and helps the credit profile to live on. So many on here say walk away. But we dont know the real story. Once DC'ed that opens up keeping the home and putting money into savings that used to go to paying debt. And you remain a full blown homeowner.

2b2rich · ‎10-16-2019

@FireMedic1 wrote:
Without knowing everything that is going to be DC'ed. Some folks have all their debt wiped out and then they can pay the motgage without lates and so forth. And keep their biggest investment in life. This is why many decide to reaffirm so it reports to the CRA's and helps the credit profile to live on. So many on here say walk away. But we dont know the real story. Once DC'ed that opens up keeping the home and putting money into savings that used to go to paying debt. And you remain a full blown homeowner.

So true! People suggest not reaffirming without knowing the entire story. The person may have equity that they are allowed to keep, that's one good reason to reaffirm.
This leads to another good reason to reaffirm: I don't believe you can sell a house that you had discharged and did not reaffirm, can you? It is no longer a 'clear deed' that you're authorized to use for transactions, is it?? Certainly not for a 2nd mortgage, so I wouldn't think for selling either?

Chapter 7 Discharged & Closed Jan 2020

Anonymous · ‎10-18-2019

That's a great question and I believe you can sell the property after BK7. In California, you can protect up to 100k in 703B in your home and in 704 BK7 you can protect 30k. I don't understand the differences between the two BK types.

despritfreya · ‎10-18-2019

@Anonymous wrote:
If I want to keep the home, the loan needs.to be reaffirmed.

Where did you get this information? Are you filing bk in the 11th Circuit (Alabama, Florida or Georgia)?

As far as I know, unless you live in the 11th Circuit, there is no requirement to reaffirm a loan secured by real estate in order to keep the property.

In the 11th Circuit case law from quite a few years ago supported the argument that if the lender required one to reaffirm and, if the borrower didn't, the lender could foreclose. Not sure if that is still the situation in that Circuit.

Des.

despritfreya · ‎10-18-2019

@2b2rich wrote:.

. . . This leads to another good reason to reaffirm: I don't believe you can sell a house that you had discharged and did not reaffirm, can you? It is no longer a 'clear deed' that you're authorized to use for transactions, is it?? Certainly not for a 2nd mortgage, so I wouldn't think for selling either?

That’s not quite true

You DO NOT, I repeat DO NOT lose your rights to YOUR home if you do not reaffirm.

In all states (except MAYBE the ones in the 11th Circuit), the choice NOT TO reaffirm DOES NOT change your ownership in the home.

So long as you continue to service the loan (loans if there is more than one) you keep your home and, when you sell it, the equity you worked so hard to build up.

Now, of course, if you have non-exempt equity and have filed a Chapter 7, your Trustee is going to attempt to sell the home out from under you, pay off the liens, give you the allowed exemption amount and use the rest for your creditors.

Des.