Hello - I was perusing the massive thread on settlements and couldn't see a situation quite like ours.
We live in FL. Our first mortgage balance is around $115k and the second $50K. The house is worth about $108K currently.
Here's the tricky part. My wife and I were on both loans. I filed individual BK7 in 2009 (she did not file). Both the first and second were not reaffirmed. The payments have always been made on time for both loans - before, during, and following the BK. I guess for my purpose I'm in a ride-through. However, since she did not file I believe she is still "on the hook".
One final twist - we are doing an FHA streamline now, which will put me back on the hook for the first. We are still waiting to see if the second will subordinate again.
That said, I'm interested in seeing if settling is an option or if there are other smarter options to handle the second loan. I've already paid about 45k in interest on this loan (the rate is insane) and I want to eventually get this house to a point where we can sell it. I think I'm safe as far as collection activities go. They can't foreclose. I am worried about what could possibly happen with my wife still being on the loan.
It was stupid to file individual BK7. If we had filed joint we would have bailed a long time ago. Now I'm trying to figure out if I have any options besides paying the full 50k balance on the second. I'm prepared to pay up to 20% for an easy solution, especially if it involved keeping this off her credit.
Thanks for any input!