Heloc nightmares-please help - Loan Modification Forum

organic potter · 09-05-2009, 12:33 PM

Our story,
We live in Sonoma County CA. and have owned our home for five years. Purchase price was 400k (tax assessor appraised it last month for 381K) Our first loan is through First Horizon owned by Bank of New York. Our Heloc is 75k and with Citibank.
I have been trying to get a loan mod (and have not made a payment) since May it has been assigned to a processor and I was just told it would be another 45 days. The loss mitigation section has halted the foreclosure.

I owe about 50k in credit card debt (not including my partner’s debt) and I need to file bankruptcy due to a loss in income. (3k per month down to 800.00per month and during the months of May–Aug. We grossed approx. 7K total for the four month period). This put us WAY behind. I was told that I pass the means test by 300.00, since a great portion of income of my partner is allocated to me. Here is the situation I need advise on.

If I file chapter 7 (which I plan to do by the end of this month)First Horizon said they will have to halt the modification process and I will need to re apply. If I do that and get a mod. Great. If not then I am still stuck with a payment I can’t afford. My main concern is my heloc. If I do a short sale can Citibank come after me for the money on the heloc?

If I foreclose because I can't afford the payment offered in the loan modification or I don't get a loan mod can Citibank come after me for the money owed in the heloc?

I was told by First Horizon that even if I get a mod before I file chapter 7 they may have me reapply. But she couldn’t say for sure. Any advice?

I realize that the safest thing to do is walk away from the house in chapter 7.
I think that will take care of the heloc also. But I really want to save my house.
Any advise would be appreciated.
Thank you!
Lisa

09-05-2009, 12:33 PM	#1 (permalink)
organic potter Member Join Date: Sep 2009 Posts: 8 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Heloc nightmares-please help Our story, We live in Sonoma County CA. and have owned our home for five years. Purchase price was 400k (tax assessor appraised it last month for 381K) Our first loan is through First Horizon owned by Bank of New York. Our Heloc is 75k and with Citibank. I have been trying to get a loan mod (and have not made a payment) since May it has been assigned to a processor and I was just told it would be another 45 days. The loss mitigation section has halted the foreclosure. I owe about 50k in credit card debt (not including my partner’s debt) and I need to file bankruptcy due to a loss in income. (3k per month down to 800.00per month and during the months of May–Aug. We grossed approx. 7K total for the four month period). This put us WAY behind. I was told that I pass the means test by 300.00, since a great portion of income of my partner is allocated to me. Here is the situation I need advise on. If I file chapter 7 (which I plan to do by the end of this month)First Horizon said they will have to halt the modification process and I will need to re apply. If I do that and get a mod. Great. If not then I am still stuck with a payment I can’t afford. My main concern is my heloc. If I do a short sale can Citibank come after me for the money on the heloc? If I foreclose because I can't afford the payment offered in the loan modification or I don't get a loan mod can Citibank come after me for the money owed in the heloc? I was told by First Horizon that even if I get a mod before I file chapter 7 they may have me reapply. But she couldn’t say for sure. Any advice? I realize that the safest thing to do is walk away from the house in chapter 7. I think that will take care of the heloc also. But I really want to save my house. Any advise would be appreciated. Thank you! Lisa

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