2nd mortgage sold to Green Tree after bankruptcy

[Wolverine]

Have a 1st and 2nd with Countrywide....now BoA. Will give you the shortened version. 1st and 2nd add to approx $218,000, with the 2nd being about $20,000. Had to file bankruptcy and included both the 1st and the 2nd in the bankruptcy. Was just discharged December 15th. Hadn't heard anything from BoA until we got a letter yesterday saying that our 2nd was sold to Green Tree. How can they do that if it has been discharged in the BK? Are they just that far behind? Because they apparently knew during the BK because our statements that came during that time had the BK disclosure on them.

Prior to the BK we tried a mod with them and a long story short we have not made a payment since September 08. No, sheriff's sale notice....nothing ever seemed to get very far with them. We would just get the notices and statements saying how far behind we are. Was wondering if they will do a principal reduction now that the 2nd was discharged in BK or will they eventually just accelerate the foreclosure process? How long does that usually take after BK??

Thanks for any help!

[Wolverine]

Should also add there are comparable houses selling for around 170k in the area...so we are about 35k+ under water.

[Wolverine]

No opinions from anyone? Someone has to at least know how long it will take BoA to get going on the foreclosure after Ch 7 bankruptcy has been discharged.

[Wolverine]

I thought of another question....Since I didn't reaffirm my mortgage in the bankruptcy how will that be reflected on my credit report when/if they follow through on the foreclosure? Right now it lists Ch 7 bankruptcy on my credit report. As I continue not to make payments will those be added to my credit or will I just get a foreclosure added?

Thanks!

p.s. I tried calling the customer service # for Green Tree, was going to tell them that this 2nd was included in the BK, their automated system disconnects me after telling me that my info isn't in their system yet.

[Housebroken13]

Great post Wolverine. Same deal with me I filed for Chapter 7, was discharged in June of 2009.

Green Tree purchased my 2nd mortgage from Irwin Home Equity after I filed.

I got a great mod on my 1st Mortgage with Bank of America.

Would love to figure out how to get rid of this 2nd mortgage, it's completely unsecured.

[Wolverine]

Great post Wolverine. Same deal with me I filed for Chapter 7, was discharged in June of 2009.

Green Tree purchased my 2nd mortgage from Irwin Home Equity after I filed.

I got a great mod on my 1st Mortgage with Bank of America.

Would love to figure out how to get rid of this 2nd mortgage, it's completely unsecured.

Thanks for responding. What does Green Tree say when you tell them that your 2nd was discharged in bankruptcy? I really can't see what there is in it for them to buy a 2nd that has been discharged....even if they paid peanuts for it. Did you reaffirm your 1st when filing? If so tell me about your mod. I didn't reaffirm either my 1st or 2nd.

[Wolverine]

Does anyone know of a financial incentive for Green Tree to be purchasing 2nd mortgages after a bankruptcy??

Great post Wolverine. Same deal with me I filed for Chapter 7, was discharged in June of 2009.

Green Tree purchased my 2nd mortgage from Irwin Home Equity after I filed.

I got a great mod on my 1st Mortgage with Bank of America.

Would love to figure out how to get rid of this 2nd mortgage, it's completely unsecured.

[yomann]

Does anyone know of a financial incentive for Green Tree to be purchasing 2nd mortgages after a bankruptcy??

Here is my best guess: Although the 2nd debt. has been discharged in BK, the lien on the property survives.
Greentree will wait years until the property value recovers, or you sell the house, at which point they will hold the 2nd lien and that will have to be settled. I have read of folks settling the lien for 5c on the dollar.
I am also interested in an expert opinion, as I will be filing BK7 this month and would like to know how the 2nd plays out. Will check with the attorney and post what he has to say .......

[Wolverine]

Thanks Yomann for your input. I guess that makes sense if they think I am going to get a workout with BoA and stay here for 10-15 years then sell the property. If they bought it super cheap they could just sit on it and hope to cash it in years from now. Chances are BoA is going to foreclose on me eventually this year. If they don't do a principal reduction I don't think a modification would be beneficial for my financial/family situation.(might be moving to another state)

Kind of crazy that I haven't made a payment since Aug 2008 and I'm still here without a sheriff's sale notice. Maybe they forgot about me. I keep checking the mail everyday for the notice.

Here is my best guess: Although the 2nd debt. has been discharged in BK, the lien on the property survives.
Greentree will wait years until the property value recovers, or you sell the house, at which point they will hold the 2nd lien and that will have to be settled. I have read of folks settling the lien for 5c on the dollar.
I am also interested in an expert opinion, as I will be filing BK7 this month and would like to know how the 2nd plays out. Will check with the attorney and post what he has to say .......

[troubleinriverside]

I'm hopeing for that exact scenario. I am in Ch-7 bankruptcy. I have a $240K HELOC with HSBC. House is underwater or slightly above. I have my fingers crossed that HSBC will sell off the HELOC. Then I can offer whoever gets it 5-10% lump sum to release the lein.

Who exactly is Greentree ?? are they a JDB (Junk Debt Buyer)

[Wolverine]

I don't know anything about them other than what I have seen on a couple posts in this forum. They sound like a company that gets very aggressive when people get a little behind on their 2nd's.

I'm hopeing for that exact scenario. I am in Ch-7 bankruptcy. I have a $240K HELOC with HSBC. House is underwater or slightly above. I have my fingers crossed that HSBC will sell off the HELOC. Then I can offer whoever gets it 5-10% lump sum to release the lein.

Who exactly is Greentree ?? are they a JDB (Junk Debt Buyer)

[Wolverine]

Does anyone out there have experience with how fast BoA will move after a ch 7 BK?

Anyone? Anyone?

[DesertMe]

Southern California. Last payment 11/08. Filed Chapter 7 BK 03/09-discharged no asset 08/09, did not reaffirm first or second (Skank of America/CW). NOD issued 09/09, substitution of trustee to Recontrust (BofA's "foreclosure division) 11/09 and since then a big NOTHING. No Notice of Trust Sale, no sign, no nothing. They are sitting on thousands of homes in foreclosure to keep them off their books as bad loans. I have called Skank of AMerica repeatedly asking them when they are going to foreclose and all I get is the same.. "You can't MAKE us foreclose"....Foreclosures here in So. Cal. are now creeping upwards of 2-3 years according to a friend who is active in the local foreclosure/short sale real estate office.

[RUMBABA]

Green Tree 'AKA" Conseco was big into mobile home loans awhile back. I had heard they were "scam artists" So now they, Green Tree buying up 2nd on properties under water. I am in the same boat as everyone else. I filed for chapter 13 It took a few months for GMAC to modify my first and in that time my second was sold to Green tree. I was plannig on stripping it. It sounds like Green Tree has become a collection agency.

[Social Apocalypse]

They are probably hoping you'll try to refi in the next couple of years, and then will receive a payoff of their lein at a negotiated amount. Remember, NEW loans now will most often never go above 80-90% LTV... and that 2nd will cut into that... it will have to be satisfied. Most mortgage companies are VERRRRRRY nervous about sharing the deed with anyone who got there before they did, in my experience.

[Wolverine]

Interesting DesertMe...
Our timelines are not too far off. Since my BK was discharged we haven't received any notices at all....aside from the first monthly statement we received for Feb. The wording in the statement was something about not trying to collect on a debt that was discharged in BK.

Will they be able to continue posting monthly no pays to my credit report? What about when they do finally foreclose? How is that listed on credit report after BK? Things are so up in the air without knowing what to expect from them....But I've been able to save a little cash while living without a house payment. I'm in MN, the foreclosure situation here isn't as bad as CA, so I wonder how long until they get to me??? I haven't contacted them asking just because I wanted to wait until I knew if I was moving out of state before I drew attention to myself.

Southern California. Last payment 11/08. Filed Chapter 7 BK 03/09-discharged no asset 08/09, did not reaffirm first or second (Skank of America/CW). NOD issued 09/09, substitution of trustee to Recontrust (BofA's "foreclosure division) 11/09 and since then a big NOTHING. No Notice of Trust Sale, no sign, no nothing. They are sitting on thousands of homes in foreclosure to keep them off their books as bad loans. I have called Skank of AMerica repeatedly asking them when they are going to foreclose and all I get is the same.. "You can't MAKE us foreclose"....Foreclosures here in So. Cal. are now creeping upwards of 2-3 years according to a friend who is active in the local foreclosure/short sale real estate office.

[Wolverine]

If/when BoA eventually forecloses Green Tree doesn't get anything, right?

They are probably hoping you'll try to refi in the next couple of years, and then will receive a payoff of their lein at a negotiated amount. Remember, NEW loans now will most often never go above 80-90% LTV... and that 2nd will cut into that... it will have to be satisfied. Most mortgage companies are VERRRRRRY nervous about sharing the deed with anyone who got there before they did, in my experience.

[Whittier]

Great post Wolverine. Same deal with me I filed for Chapter 7, was discharged in June of 2009.

Green Tree purchased my 2nd mortgage from Irwin Home Equity after I filed.

I got a great mod on my 1st Mortgage with Bank of America.

Would love to figure out how to get rid of this 2nd mortgage, it's completely unsecured.

For the 1st they are so far behind. I read that they first will wait to see if you can MOD even after BK (since BK frees up more moeny) and then in 120 days start the foreclosure process.....but they will work with you. They don't want another house on their porfolio's.

for the second: Offer them a settlement. I read that you can from 5% - 40% of balance.

[Social Apocalypse]

Question: Is your 2nd Mortgage company required to notify you of their intent to charge off your account? It seems to me that they should have to, because charging it off REMOVES your opportunity to modify it in the 2MP program, for ONE thing...

[Whittier]

They are not required, specially if you filed BK. Once you filed BK they are supposed to stop communication with you as it's a potential liability for them. Also they can justify it under "normal business practices", when you initially go the loan they did advise you that they might sell the loan off (all contact have that clause) as part of porfolio bulks.

[DesertMe]

They shouldn't be able to post anything on your account because if discharged in a BK, the lien stays on the property, but your debt to them ends. In my case, I log onto BofA's website, look up my account and it shows a zero balance.

[mom2lostboys]

Right off the top I need to say a big thank you to everyone on this forum. I have learned so much from all of you. I had to come out from the shadows for this topic.

We filed chapter 7 May 2009 and were discharged in Sept 2009. Our case is still open as we are an asset case. We did not reaffirm either our first or second mortgage with GMAC. Our home is underwater about 110K. We were notified 10 days after discharge that GMAC had SOLD our 90K second to Green Tree.

We have been working to reach a settlement with them for several months now. I am looking for any and all contact info that may be floating around out there. As of now I have not been able to get past the lower level of Loss Mit management. I will say however that the person I have been working with has been nothing but respectable and kind to me.

I am more than ready to walk from this home and I think they are starting to see that. I can rent my same updated house 5 doors down the road for $1300 less a month than my current payments. It's either we settle or they can have this old house!

While on the phone with collections manager he told me a little tid bit. He told me that GMAC would not budge from 20%. I said you mean Green Tree? He said NO..GMAC. They still own this loan. I said NO you bought it. He then said well no... I know they told you that.We never bought it. GMAC had it transfered to us to service but they still own it and they call the shots. He told me that Green Tree is doing this with a high number of discharged seconds GMAC has right now. Mostly the ones that are high balance loans.

He then said Green Tree dosen't care if you settle or let GMAC take the loss. We just have a contract with them to take over servicing these discharged loans for a premium fee. In fact he said, I think they should have just taken what you offered in the first place. Just another in the long list lies told by these mortgage companys. I don't care if I ever own another house.

For what it's worth.. When I called GMAC and asked it they still owned the loan they would not say either way. Just you need to contact Green Tree over and over and over.

[snapple candy]

wow, mom that is pretty wild!
I suspect they will hold these 2nds hoping to cash in on them down the road. But I wonder what the statute of limitations are on them being able to collect? I imagine it might vary state to state.

Wolverine, its amazing that Skank is saying you cant make us foreclose! I am assuming there is a way to have an attorney write a letter to force some action on this so you can be relived of the liability. If you discharged in BK I am assuming they can not report anything on your credit report after the BK. Seems that would be against BK law to do that.

[Wolverine]

Thanks for the input everyone!

I guess I knew they were behind and had a ton of these on their books, but I just assumed they were going to foreclose on me soon anyway. Maybe I'll just stay here without making payments for a while and save up some cash. I will probably be better off financially than if I did a mod and tried to sell my house in a few years hoping the market turned around. From all the stuff I read I really don't think the market(housing or financial) is going to go up significantly for a number of years.

The uncertainty is driving me crazy though. What happens if we want to walk away six months from now and they still haven't foreclosed? My name is still on the property, am I liable for anything that happens on the property?

Interesting story mom2lostboys....I didn't even think of that as a possibility with mine.

[robijamie]

Hello,

Here's my story and I just have to say there are so many things you say that are similar to what I"m going through:

1st with Bank of America 286,000
2nd with WaMU now Chase 33,600

Last payment: 11/08
Filed BK 7 12/08, discharged 4/09 but not closed (we an asset case) yet

We have never received anything of BofA except for our monthly notices saying our bill was due (but never with the full balance). We finally got out "Relief from Stay" in the mail last week. Now we are unsure if a NOD is going to be here quickly or what. We are kind of holding our breath, but also know that it might be awhile yet. It's scary having uncertainty, but I'm so thankful we have lived her for this long w/o payments. My dh has been unemployed for 1 year, and it has been a HUGE blessing. I wish I could say we were bouncing back quickly after bankruptcy, but with a job loss that just hasn't happened. Good luck, I will be following your story.

FWIW, Chase hasn't contacted us about anything, last payment 2/09

[snapple candy]

Wolverine,
If you can handle staying in the property and put money under the mattress, its a great way to get ahead financially. You will be responsible for any liability associated with the property until they foreclose or you have an attorney handle by way of legal surrender to them that absolves you of it. A few people have just sent a letter and the keys.

robi, you might want to ask your BK attorney is he intends to fight to Relief from Stay (many dont want to fight these because it costs them time and if you paid a flat fee, they loose interest in doing the extra work) or when the hearing date is. I dont know in your situation if you have a good reason to make a judge consider not granting it but your attorney would know this. If the judge allows the relief, that will allow the lender to proceed with foreclosure according to the laws in your state. Sounds like they are ready to start the process if they are filing for relief so its hard to say how long it would take to get the process going and serve you Notice of Sale or default. The timelines vary from state to state. For example in Oregon it is 4 mths from Notice of Sale service till auction. Then if you want to hang till they come to the door and over you cash for keys to move, it could take a month or two longer.

You probably havent heard from Chase as they are not allowed to contact you if you still have an open BK. Especially if you have no equity to attach and if you will be discharging it in BK anyways. It isnt worth the effort and cost for so little in the long run. Good luck with the process.

[Social Apocalypse]

I guess I thought that all account activity was supposed to CEASE during a bankruptcy, including moving it into a status in which PRIOR to the bankruptcy was "modify-able" and now, is NOT. Doesn't seem right does it? Well, we can just add that to THE LIST!

[snapple candy]

Social,
I think the lenders try to make borrowers think they cannot modify while in BK but that is not true, at least in my state. If your BK attorney simply writes a letter stating they can contact you and/or him, they can proceed with discussions and resume billing statements.

Yes, Motion for Relief from Stay is a way to legally proceed with collections before BK discharge and requires a hearing in front of the BK judge for it to be allowed. WAMU pulled this crap on me when I was in BK. I had exempted the property from the BK and since I wasnt getting statements, one month I went into the bank and paid my mortgage payment and was $20 under in my payment (I found this out later). It was not applied to the payment, it was put in an unapplied category in suspension...this is why it isnt wise to make partial payments. Because it was unapplied to the payment, and then the next month I was late (by 1 week) it triggered the default process. They filed the motion for relief and it ended up costing me about $500 in attorneys fees plus late charges for 2 months of $100 a pop. All this over a friking $20 shortage. I had my attorney write WAMU whom held my 1st and 2nd to allow billing to resume but never followed up on it. Home equity dept immediately resumed billing and the mortgage side did not.
That was a very big $20 mistake. I had to make my attorney write their attorney to allow them to talk to me since I was in BK so I could negotiate with them on the attorneys fees (they wanted $800) since he didnt want to do the work. He knew I didnt have anymore money so he just was going to blow it off and not even file an opposition to it. It was a mess. And it ****ed. I hate friking attorneys!

[Social Apocalypse]

Wow thanks for sharing that Snapple Candy. I love your posts. I just got a letter from Pennymac acknowledging my interest in the HAMP program but unfortunately they could not proceed because I didn't return my package. CAN YOU BELIEVE THAT? They wouldn't GIVE it to me. It's insane what these companies are getting away with. I WILL NEVER AGAIN HAVE A LOAN OR A CREDIT CARD, I swear to GOD.

[snapple candy]

Social,
Thats seems to be the problem with alot of these lenders. That wont sent you a package to even fill out. Thats when you have to take matters into your own hands and download off the lenders site all the HAMP documents or I am just working now with the HAMP ones off the govt site. Chase has a really good HAMP version one that is very detailed that I give the attorney I work for to his clients. Then I call the lenders and ask for a mailing address and they dont want to give it to me, they only want to have documents faxed. I want to send them registered mail to confirm receipt. These lenders dont like that. Its real easy to say you never returned the documents. Not so when you sent it fed-ex and get a signature.

I love your avatar! and your posts too.

[Social Apocalypse]

Right On SC; I am going to file the packet as you said, return receipt, via the HAMP website... then they can't deny the date they received them and they can't ask for crap that they aren't entitled to.

[snapple candy]

Social,
You should go to the Chase web site and download their version of the HAMP application. It includes a check sheet of all the documents required to attach to your applications. If you follow that to the letter, they wont be able to say there are any missing documents. go to: https://www.chase.com/chf/mortgage/hrm_documents

[Wolverine]

Hey Snapple Candy,
So far that's what I have been doing...stashing. Feel a little like a deadbeat though livin' in my house without making payments. I suppose I should probably ask an attorney about doing a legal surrender when it comes to that, if they don't make a move to foreclose. Do you know how successful people have been with just writing a letter and sending the keys? Doesn't sound very official/legal.

Someone already answered my question about them not being able to continue posting late/no pays on my credit report since they were discharged in the BK, what about if they foreclose now after the BK, will that be listed as a foreclosure on my credit report as well?

I wonder how receptive they would be to a mod that involves principal reduction to market value?

Wolverine,
If you can handle staying in the property and put money under the mattress, its a great way to get ahead financially. You will be responsible for any liability associated with the property until they foreclose or you have an attorney handle by way of legal surrender to them that absolves you of it. A few people have just sent a letter and the keys.

robi, you might want to ask your BK attorney is he intends to fight to Relief from Stay (many dont want to fight these because it costs them time and if you paid a flat fee, they loose interest in doing the extra work) or when the hearing date is. I dont know in your situation if you have a good reason to make a judge consider not granting it but your attorney would know this. If the judge allows the relief, that will allow the lender to proceed with foreclosure according to the laws in your state. Sounds like they are ready to start the process if they are filing for relief so its hard to say how long it would take to get the process going and serve you Notice of Sale or default. The timelines vary from state to state. For example in Oregon it is 4 mths from Notice of Sale service till auction. Then if you want to hang till they come to the door and over you cash for keys to move, it could take a month or two longer.

You probably havent heard from Chase as they are not allowed to contact you if you still have an open BK. Especially if you have no equity to attach and if you will be discharging it in BK anyways. It isnt worth the effort and cost for so little in the long run. Good luck with the process.

[Wolverine]

A little update...
I called Bank of America a few days ago and after a few transfers I talked to someone who told me I had to update them with all my financial information to see if there was a possibility of working anything out.

Well, I'm now actually making decent money....so does that mean that a principal reduction would be pretty unlikely?

Anyone with thoughts on this?

[Housebroken13]

Hi Wolverine,

Any updates on Greentree, I'm over 90 days late and haven't heard a word from them. I recently sent in a settlement offer for 5% of the principal balance. I indicated how underwater I was in the home, and reiterated that the debt was already discharged in a Chapter 7 when it was serviced/owned by Irwin Home Equity

[islandgirlmaine]

I just found this post. My BK was in 2008. I have continued to pay my 1st mortgage but was unable to pay the BOA second that was sold to Green Tree. Our house is worth less than our first mortgage. I have heard nothing at all from Green Tree in 3 years. I too tried to call them and got no where.

I am terrified every day that we are going to lose our house. Have you (or anyone) been able to negotiate any kinf settlement with Green Tree?

[LMG462]

Islandgirlmaine, Green Tree is not allowed to contact you because of the BK. Don't waste your time worrying about them foreclosing on you. If you are underwater they have no incentive to do so.

[Housebroken13]

My Greentree 2nd was charged off in January of 2011. Haven't heard a peep since...

[TomEason]

My Greentree 2nd was charged off in January of 2011. Haven't heard a peep since...

Housbroken13
Since your debt was discharged in your Ch7, you likely won't be hearing from GT. The only reason for your ever settling is to have the 2nd lien re-conveyed. If you are seriously underwater, there's no rush in settling. And some homeowners may never need to settle. Your timing will depend on the forecast of how long it will take your property to eventually appreciate to the point where the GT 2nd is clearly in the money. That timing will depend on the anticipated recovery time in your RE micro market.

[Madd0g]

Important clarification:

In any correspondence with Greentree you should state: I do not owe this loan nor do I intend to reinstate the loan. This loan was washed away in my chapter 7.

Any settlement should be in regards to "removing the lien" and not settling the debt. The debt is gone.

Greentree's strategy, my guess, would be to await foreclosure as a high percentage of chpt 7 people end up walking from homes as well and then they get a spiff from the first lender. My guess is they buy the lien for 1% and settle for 3% eventually. Their other strategy would be to try to collect the debt from the home owner. If the home owner is not careful how they discuss this they can become liable for the note.

I would recommend attempting to settle with Greentree for 3-5%. No more.