I'm considering filing chapter 7 soon. Just wondering if Countrywide will do a modification after a bankruptcy?
I'm considering filing chapter 7 soon. Just wondering if Countrywide will do a modification after a bankruptcy?
We have two Bank of America (previously Countrywide) loans. Prior to filing our Chapter 7 bankruptcy, we set up a trial modification with both loans. After two months into our trial, we filed our bankruptcy. When B of A found out, they said, due to the BK filing, the trial agreement was null and void. We had to get our attorney to write a letter to B of A allowing them to talk to us while in bankruptcy. We have sent in our loan modification packages and are awaiting their response. We probably will be discharged before we get an answer regarding the modifications.
I don't know whether this applies to all B of A loans or just certain investors. One of my investors is Bank of New York (our primary residence) and the other is Duetsche Bank (an investment property).
I had a Chapter 7 and a mortgage with BofA/CW. Mortgage discharged in BK. They will not talk to you until BK discharged and mortgage reaffirmed. Since they refused to do a loan mod, I chose to walk and not reaffirm mortgage. And yes, they are foreclosing, but I did get a years "free rent"...If you wish to keep your house, then reaffirm (and keep up payments), if not......
BAC will do Mods with BK as long as you get a letter from attorey stating they can still speak to you during BK, BAC changed their rules on BK about 6 mos ago because so many were going BK during mods and delaying the process.Originally Posted by Liza09
I'm trying to understand...does Bank of America expect you to reaffirm the mortgage if you've gone bankrupt - in order for them to consider a modification? I would hate to reaffirm the debt and then be told "unable to modify"...then technical I would be responsible for the loan and deficit.
I've been trying to do a modificaiton on my home for 10 months...given the run around so many times...even got a temp modification, paid 4 months, only to be told I don't qualify for that program. On Friday, I spoke with someone in the OOP and told them I was going to file bankruptcy due to auction scheduled at the end of this month...and they postponed the auction for 30 days telling me they would work on the loan and if I filed bankruptcy right now they couldn't help me. Interesting...
Re: Countrywide and Bankruptcy I APOLOGIZE - SORRY BUT BULLCRAP
NOOOOOOO FRICKIN WAAAAAAAAY WRONG !!!
B of A 100% LIED TO YOU and or your lawyer was misinformed or unaware
They / B of A are Defrauding Liers -
In the HAMP rules and regs Banks must NOT hold the BK against you in any way shape or form and must still negotiate and must not cancel any prior ongoing / pre BK negotiations
They must still talk to you and negotiate, especially when your lawyer sends them a letter stating it is legally agreed that B of A can negotiate with you DURING THE BK !
You DO NOT have to wait for the Discharege at all !
In the HAMP they MUST NOT FORCE YOU TO REAFFIRM THE LOAN !
So I would tell them it is illegal for them not to negotiate during the BK process and it is ALSO Illegal to force you to reaffirm the laon after the debt has been discharged in BK
I would just tell B of A what they MUST LEGALLY DO and make sure your lawyer sends them a letter to that effect !
Otherwise Bank of America will LIE, CHEAT, STEAL FROM YOU and DEFRAUD YOU !
Good luck
Keep fighting and know your rights - All the info you need is on this site, Just got to search for it a bit
But your Lawyer really should already know all these facts by now, since this HAMP and Modification process has been going on for several months now ...
Thanks for the information! I'll go talk to my attorney. We hadn't even even asked our attorney about negotiating with bank in bankruptcy...he thought we were just going to give up the house as we have lost $600,000 in value...although it's hard to totally walk away as we put down over $200K...although who knows when the value will come back...maybe in 15yrs...we must be crazy to even considering trying to fight for the house...
You are crazy NOT to fight for your home...
Ask for an in house mod - Fixed 2 % interest for 40 years with a principal reduction if needed - The principal reduction can be added as a balloon payment at loans end or when you sell the home.
If they wil not work with you, keep on trying anyway and make sure to drag the BK out for as long as posssible !! Up to 2 years
They can not foreclouse on you while you are in bankruptcy
Stall Stall and stall JUST LIKE THEY DO
Never pay any of your mortgage payment NEVER Not until they offer you a permanent in house mod
No frickin trial periods Trial periods are 95 % of the time a waste of time and money..
If they offer a trial period, pay your attorney an extra $100.00 To look it over and explain to you if the trial period is a legitimate deal and will work for you.
No harm at all in fighting the bank for a couple of years, while you drag your feet in BK and stay in your house rent free and save the money in a friends or relatives account.
Screw the bank because that is exactly what they are doing to you
Know you legal rights and make those rights work for you NOT THE BANK !
Once these frickin banks start realizing people are on to their defrauding backstabbing games, then the banks will be forced to wake up and work with us !
Are you current on your mortgage when you filed for Chap 7? I heard some lawyer advise their client to be current before filing.
First of all, it is not "bullcrap"..Second, I had an EXCELLENT attorney...Third, the OP made no mention of any letter reaffirming her mortgage. And last, BofA will not speak to you until a BK is discharged. They cannot legally attempt to collect ANY debt during a BK. You have a choice in BK, reaffirm the mortgage or not. I chose not to reaffirm because I wanted the option of walking away if I chose to do so after discharge. Plus filing BK is the LAST thing the banks want because if your mortgage is included you can walk and they know it. After mine was discharged BofA came up with all kinds of offers, but in the end because the house was seriously underwater, I chose to walk away. If you choose to reaffirm during the BK, you are on the hook for that mortgage and your option to walk away does not exist. I would "include in bankruptcy" all mortgages and then play "let's make a deal" if you wish to keep the house. I would agree though, that BofA is learning how to play the game of let's shaft the mortgage holder, and figure out what's best for the bank. HAMP is kind of a joke...
Re: Countrywide and Bankruptcy First - I very much disagree -
Second - I have no doubt your attorney was a good BK attorney.
Third and Sadly, your attorney knew NOTHING about how he or she should have wriitten a letter to B of A and had them negotiate with you during the BK.
Bank of America will negotiate during the BK process
Reaffirming a loan is NEVER a good idea of course - I agree
If any homeowner can negotiate for about the same as the bank would get in a short sale or after a forclosure, the bank will usually work with original borrower or the homeowner can do a short sale to a friend or relative and rent the house from the friend or relative, until such a time as the original owner can again re-purchase the home back.
B of A always wants to shaft the homeowner - It is the current banking climate motto - Screw the Homeowners -
It was always the banks Premediated plot / plan to do so...
Except they did not foresee Obama wanting to help owners and how the President would try to force the banks to help with HAMP etc.
Yes, I agree, the banks are intentionally manipulating any and all helpful programs, especially HAMP, to their own devious, diabolical and dispicable advantage - At least 95 % of the time they are.
This is why we the people must continue to fight against these banking dark devils, who are from self serving hell..
WE MUST FORCE THE BANKS TO SEE THE LEGAL LIGHT & SEE THE NON-DEMOCRATIC DARKNESS OF THEIR SWINDLING WAYS & ALSO FORCE OUR GOVERNMENT - WHO SUPPOSEDLY WORKS FOR US THROUGH OUR TAX DOLLARS - TO FORCE THESE SWINDLING BANKS TO DO THE RIGHT THING FOR DISTRESSED, DEFRAUDED & DISCRIMINATED AGAINST HOMEOWNERS
If WE give up and walk away, we are playing the banks game...
I certainly do think every case is unique however and everyone needs to do what is best for them
Sadly, the modification process is so fraught with intentional fraud and intentional misinformation from the banks and even attorneys that, it is difficult to fight against these lawbreaking banks
As long as we keep fighting for ourselves and never let up and force our paid for governemnt to work for we the people, we have hope and their is a VERY good chance the banks will eventually be forced to help us all, or at least most of us
KEEP ON FIGHTING FOR THE TRUTH EVERONE & NEVER TAKE NO FOR AN ANSWER !
My research on Chap 7 during mod is very mixed.
It seems to be at the option of the lender but other places infers can still do mod.
But it is true the lender can not try and collect the debt and to me it makes sense they can't even discuss it since by doing so may be a debt collection action which is forbidden while the stay is in effect.
But the bank can motion to remove the stay related to the house and go ahead with a foreclosure sale. Is confusing.
It actually sounds right that attorney can give bank permission to discuss. That would seem the only way around the no collection activity until stay is lifted or safer yet for the banks after discharge.
Here is one lawyers discussion:
Some servicers require homeowers to reaffirm their mortgage before they will consider them for a HAMP modification. This complicates the reaffirmation analysis for reasons discussed below.
But, first let’s back up a bit and discuss reaffirmation and secured debt in general.
Secured debt in bankruptcy
Secured debt such as a mortgage includes two components: you are personally liable for paying the debt, AND the collateral (your house, in the case of a mortgage) can be taken away if you don’t pay.
A Chapter 7 bankruptcy generally relieves homeowners of personal liability for paying their mortgage.
But, the lender retains the second “part” of the debt– the right to foreclose if you don’t make mortgage payments.
Reaffirmation of a mortgage: what is it?
When you sign a reaffirmation agreement, you agree to remain personally liable on the mortgage after your bankruptcy. Your bankruptcy would otherwise relieve you of this personal liability. More below on why this is significant, but suffice it to say reaffirming your mortgage in a Chapter 7 bankruptcy can be a very bad idea.
Doesn’t the 2005 bankruptcy law require me to reaffirm?
Technically, the 2005 BAPCPA changes to the Bankruptcy Code force debtors to choose between reaffirming a secured loan DURING the bankruptcy or surrendering the collateral.
But– maybe because no one seems to have equity in their houses any more– bankruptcy courts do not seem especially eager to force the issue when debtors continue to make their mortgage payments.
If you want to keep the home I don't see the problem with reaffirmation at least on the 1st. 2nd might be stripped. But Chap 7 itself will not save the house. Under Chap 13 the delinquent payments rolled into the plan but still have to pay all future payments in full.
More:
Obviously, if the bankruptcy court tells you to reaffirm or else surrender your house, you will need to consider reaffirming. But, you should also consider whether surrendering the house makes more sense.
And, some mortgage servicers refuse to consider a homeowner for mortgage modification (including HAMP modifications) unless the homeowner reaffirms.
Generally, a homeower should NOT consider reaffirming until he or she has a firm, written modification offer in writing specifying all terms– including the interest rate.
Otherwise you could reaffirm but never actually receive a modification offer. You then would have signed up for personal liability and gotten nothing in return.
Be prepared for a “chicken or egg” problem, however. Considering servicers’ seeming reluctance to process modifications, it can be difficult to get them to produce the modification paperwork before they have everything they want– including the reaffirmation.
Don’t let this deter you from requesting a modification, however. Homeowners have reported some servicers did not even raise the issue of reaffirmation when they applied for a post-bankruptcy modification. (And the homeowners, perhaps wisely, did not “remind” the servicers about the bankruptcy discharge.)
This may just be because the servicers are disorganized. Or, maybe servicers have started to realize it is in their best interest to modify.
Source: Chapter 7 Bankruptcy: Mortgage Reaffirmation and Mortgage Modification, Including HAMP |
Another Attorney says:
Many Chapter 7 debtors state on their petitions that they intend to keep their exempt home and "reaffirm" the debt, but during the bankruptcy they do not sign reaffirmation agreements with their mortgage lenders. Bankruptcy law requires debtors sign reaffirmation for personal property they keep, such as their car, but there is no required reaffirmation agreement for loans secured by real property, such as the homestead. If a debtor lists his mortgage but does not reaffirm the mortgage note the debtor no longer has personal liability on the mortgage note after the bankruptcy discharge. The mortgage lender attorney explained that his client, the mortgage company, can not or will not modify a mortgage when the borrower is not personally liable to pay the mortgage. In other words, why would the lender want to extend their own risk on a defaulting loan and offer better mortgage terms to a borrower who has eliminated their own personal risk?
Debtors who hope to modify mortgages may want to consider reaffirmation of their mortgage debt. Debtors should be wary of signing a binding modification agreement with their mortgage lender based on the lender’s oral statements and the debtor’s hope that the mortgage can be modified. Debtors can withdraw reaffirmation commitments until the bankruptcy case is closed or for 60 days, but thereafter, the reaffirmed debt binds the debtor whether or not the mortgage lender agrees to an attractive loan modification.
posted by Jonathan Alper, bankruptcy and asset protection attorney, Orlando, Florida
Ok speaking from experience, We filed bankruptcy in June, I wrote the OOP in June also, told them what we were going through, that we very much wanted to keep our home. We have /had a very real hardship, we lost our 26 year old son, and my husband had to go on disability because of it (sad story) he took a 30% pay cut, and I also have been unemployed since my employer closed his business. I have a very nice person I am working with, and am hoping I am being told the truth, I am not stupid or naive enough to not keep informed, thus reading this site everyday and keeping in touch with BofA. I have never had to have a lawyer write a letter, nor have I ever had anyone from BofA tell me I can't or don't qualify for a mod. Write the office of the president, that is my suggestion. just be nice. that is just my 2 cents. be patient, and NEVER take the 2st persons word for anything whilst dealing with Bofa...
I was with countrywide when I filed for BK Chp 7, I had signed a loan mod agreement right before I filed. They terms Countrywide gave me were horrible, plus they did not even take into account the second lien.
I went back to BAC once they purchased Countrywide and the HAMP was introduced. My BK was discharged in June of 2009. Both my 1st and 2nd mortgages were reaffirmed also. Not sure why my attorney reaffirmed the 2nd....
Right now i am on a 6 month HomeSaver Forebearence, and have no idea what will happen.
I am now dealing directly with BOA's legal department.
Someone did answer the phone at the number I was given and they told me this is a good thing, it's not a bad thing.
I'm proceeding with high caution at this point....
Re: Countrywide and Bankruptcy -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
You shoud SUE your attorney for reaffirming the loans
YOUR ATTORNEY SHOULD BE DISBARRED FOR NOT EXPLAINING WHY HE OR SHE REAFFIRMED THE LOANS -
PURE INCOMPETANCE OR THEY GOT PAID OFF BY THE LENDER TO DO IT
I WOULD FILE A COMPLAINT WITH THE BAR ASSOCTION TO GET HIS LICENSE REVOLKED !
Re: Countrywide and Bankruptcy [QUOTE=davephx;145072]More:
Obviously, if the bankruptcy court tells you to reaffirm or else surrender your house, you will need to consider reaffirming. But, you should also consider whether surrendering the house makes more sense.
And, some mortgage servicers refuse to consider a homeowner for mortgage modification (including HAMP modifications) unless the homeowner reaffirms.
Generally, a homeower should NOT consider reaffirming until he or she has a firm, written modification offer in writing specifying all terms– including the interest rate.
Otherwise you could reaffirm but never actually receive a modification offer. You then would have signed up for personal liability and gotten nothing in return.
Be prepared for a “chicken or egg” problem, however. Considering servicers’ seeming reluctance to process modifications, it can be difficult to get them to produce the modification paperwork before they have everything they want– including the reaffirmation.
Don’t let this deter you from requesting a modification, however. Homeowners have reported some servicers did not even raise the issue of reaffirmation when they applied for a post-bankruptcy modification. (And the homeowners, perhaps wisely, did not “remind” the servicers about the bankruptcy discharge.)
This may just be because the servicers are disorganized. Or, maybe servicers have started to realize it is in their best interest to modify.
Source: Chapter 7 Bankruptcy: Mortgage Reaffirmation and Mortgage Modification, Including HAMP |
Another Attorney says:
Many Chapter 7 debtors state on their petitions that they intend to keep their exempt home and "reaffirm" the debt, but during the bankruptcy they do not sign reaffirmation agreements with their mortgage lenders. Bankruptcy law requires debtors sign reaffirmation for personal property they keep, such as their car, but there is no required reaffirmation agreement for loans secured by real property, such as the homestead. If a debtor lists his mortgage but does not reaffirm the mortgage note the debtor no longer has personal liability on the mortgage note after the bankruptcy discharge. The mortgage lender attorney explained that his client, the mortgage company, can not or will not modify a mortgage when the borrower is not personally liable to pay the mortgage. In other words, why would the lender want to extend their own risk on a defaulting loan and offer better mortgage terms to a borrower who has eliminated their own personal risk?
Debtors who hope to modify mortgages may want to consider reaffirmation of their mortgage debt. Debtors should be wary of signing a binding modification agreement with their mortgage lender based on the lender’s oral statements and the debtor’s hope that the mortgage can be modified. Debtors can withdraw reaffirmation commitments until the bankruptcy case is closed or for 60 days, but thereafter, the reaffirmed debt binds the debtor whether or not the mortgage lender agrees to an attractive loan modification.
posted by Jonathan Alper, bankruptcy and asset protection attorney, Orlando, Florida[/QUOT
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IN THE FANNIE MAE HAMP ANNOUNCEMENT 09 - 05 R SERVICING GUIDE
APRIL 21 09 & REPOSTED ON MAY 15 09
I HAVE IT IN MY FILES BUT COULD NOT FIND THE WWW LINK
SEARCH FANNIE MAE OR GOOGLE FOR IT
OOPS JUST FOUND IT
https://www.efanniemae.com/sf/guides.../2009/0905.pdf
PLEASE READ PAGE 3 / THE 7th BLACK DOT PARAGRAPH.
PLEASE READ PAGE 18 / THE 3rd BLACK DOT PARAGRAPH ON CHAPTER 7 BANKRUPTCY & REAFIRMING MORTGAGES -
DO NOT Reaffirm !
Yes, the ass-hole banks have supposed, quote "Discretion"
But in this climate of their Diabolical and Evil Frauds, which are being constanly exposed, the banks will do the right thing when we the borrowers keep on pushing these conniving, defrauding banks / servicers & Investors, to do the right thing, especially when armed with the proper HAMP rules regulations and " Guidlines"
NUFF SAID
We did not reaffirm the mortgage debt, maybe it is different for each state?
Thanks for the information. Still trying to figure out if I should file Chapter 7 now, or wait to see if I get a modification first. We are going to have to file Chapter 7 (due to death in family, reduction of overtime, and debt incurred to hold house) so just trying to figure out when the right time is to file. I got through the OOP, emailed fiancials and now am being told I'm being assigned a negotiator...but not sure when I'll hear from them as I applied for help from NACA so they may decide to not talk to me, even though I haven't heard from NACA since signing up online a month ago...
Ester just make sure you get a letter from your attorney stating that the bank can still speak with you during BK process.
I'm curious...those of you who filed bankruptcy...did Bank of America request to the court to be able to sell the home (if you are not reaffirming) within 30 days or did they wait to foreclose and sell until after the bankruptcy discharge?
Hi
I got a decent mod back in February and have been current ever since. Now the delinquent credit cards are starting to come after me. I am going to file a Chaper 7 but my only worry is that BOa will cancel the modification. I want to reaffirm as I do NOT want to lose my home. I have some equity and I know in a few years I will have alot more. I dont want to take a chance nor reaffirming and then they foreclose on me since the house has some value. Has anyone else done this?
Thanks
OK - That is GREAT news about being assigned a negotiator
Make sure you get ALL the contact info from them e mails fax numbers alternate negotiator number & e mail if they are sick or leave the company etc etc
Now, when the negotiator starts to look at you debts, he or she might say, you have a lot a debt, Credit cards etc ??? I assume you do with BK thoughts ??? then they might say, if we give you a mod how do you expect to pay your mod payments, you can't even afford your other debts, so we say NO MOD FOR YOU, you do not qualify !
I owuld bring this scenario uo the first time you talk to the negotiator, to see what they say, before they officially DENY YOU ON PAPER, then you have to start all over again..
If they state on the phone NO MOD, then get into the BK and tell them would you qualify with the BK and all debts gone
Then if they say yes, once your debts are discharged you will qualify, then say ok, keep the file open, keep working with me during the BK process and let me know what the mod will be, etc
That is one way to go
If your financials do not look good, even after BK and it looks like they will not work with you ever, then I would wait until after BK and start the process again, as you have more power, since the home debt is no longer your responsiblity.
You can stop making payments and hope they work with you after BK
After BK start up the MOD process with B of A then if they refuse move on the NACA
After all is said and done, you wil hopefully come out of this twister with a sustainable / Viable Mod and if NOT then you should have at least been able to stay in your home for 1 to 2 years with no payments and take that saved money and move on.
Do not keep paying mortgage money to B of A as they will only pocket the money for themselves and still foreclose on you
If the Mod does come through, then you have saved money, hidden in a freind or relatives account or in your safety deposit box at a another bank.
Keep researching here on loansafe, as this game is well understood by the banks and little understood by us
Good luck
Hi
I got a decent mod back in February and have been current ever since. Now the delinquent credit cards are starting to come after me. I am going to file a Chaper 7 but my only worry is that BOa will cancel the modification. I want to reaffirm as I do NOT want to lose my home. I have some equity and I know in a few years I will have alot more. I dont want to take a chance nor reaffirming and then they foreclose on me since the house has some value. Has anyone else done this?
Thanks
DO NOT REAFFIRM WITH B OF A
REAFFIRMING DOES ABSOLUTLEY NOTHING FOR YOU
BK WILL IN NO WAY MAKE B of A DO ANYTHING TO YOU
AS LONG AS YOU KEEP PAYING YOUR MORTGAGE THEY CAN NOT FORECLOSE OR CANCELL THE MOD
UNLESS YOU SIGNED SOMETHING TO THAT EFFECT ? DID YOU ?
ASK YOU ATTORNEY THIS QUESTION ALSO
AFTER THE BK JUST MAKE SURE B OF A WILL STILL REPORT YOUR HOUSE PAYMENT TO THE CREDIT PEOPLE AS BEING PAID ON TIME SO THAT YOUR CREDIT SCORE WILL BUILD BACK UP AGAIN
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