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FHA-HAMP refi denied because of bankrupcty

Discussion in 'Chase Mortgage - Tell Us Your Chase Story' started by SharksFan, Sep 23, 2013.

  1. SharksFan

    SharksFan LoanSafe Member

    I currently own a house with a FHA chase mortgage (taken out in 2010) with a non-spouse, who no longer lives at the property.

    I was approved for a FHA-HAMP trial, and made 5 payments so far. After the first payment, the OTHER person on the load filed for Chapter 7 BX. My mod file was transferred over to someone else at Chase, who assured me the BX will not change anything with my modifcation.

    After 3 trial payments, my Chase rep called me and said to quailify for the mod the OTHER person must reaffirm the mortgage in her BX. I informed her, and she filed the intent to reaffirm in her BX.

    After 5 trial payments, I get a call from another rep at Chase stating my FHA-HAMP has been denied, as the BX made me ineligible for a FHA-HAMP. She stated OTHER person must have reaffirmed in BX, however Chase would not agree to reaffirm unless mortgage is current. The OTHER person's BX is just about over, probably will be discharged this week.

    I've looked everywhere online, and it appears BX does not disqualify someone from FHA-HAMP. From http://www.justice.gov/ust/eo/public_affairs/consumer_info/docs/HAMP_FAQs.pdf :
    <dir><dir>12. Am I eligible for HAMP if I have received a chapter 7 bankruptcy discharge?[FONT=Arial,Arial][FONT=Arial,Arial][/FONT][/FONT]
    [FONT=Arial,Arial][FONT=Arial,Arial]Yes, even if you have received a chapter 7 bankruptcy discharge, you are eligible for HAMP. If you did not reaffirm your mortgage debt, the following language must be inserted in the Home Affordable Modification Agreement:
    [/FONT]
    [/FONT]</dir></dir>[FONT=Arial,Arial][FONT=Arial,Arial][/FONT][/FONT]
    [FONT=Arial,Arial][FONT=Arial,Arial]"I was discharged in a chapter 7 bankruptcy proceeding subsequent to the execution of the Loan Documents. Based on this representation, Lender agrees that I will not have personal liability on the debt pursuant to this Agreement."

    Since Chase says the OTHER person did not reaffirm (sign an agreement w/ Chase), then wouldn't they just need to insert that language? They said I can reapply for an in house mod, but it will not likely reduce my monthly payment by much as I'm currently at 5.0%.

    Any ideas on what to do next? Their reason does not sound valid. I've been reassured this whole time by Chase everything was fine and now the final approval gets turned into a denial. I currently owe $310k and property is valued around $370k.

    Thank you for your help in advance :(
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  2. Evan Bedard

    Evan Bedard Call 1-800-779-4547 Loan Safe Mortgage

    Hello Sharksfan,

    While it's true that a BK will not disqualify you from being approved for a modification, the fact that the co-borrower filed during the trial period can affect their decision. They have equal liability and a bankruptcy filing can and will affect the modification process, especially if you are getting close to a final decision. Did you supply any of the co-borrower's income of financial docs for the modification?
  3. SharksFan

    SharksFan LoanSafe Member

    Yes, their income was given to Chase. However, since they are no longer living in the house, Chase said the modification would only be based off my income. The trial payments were $800 lower than my regular mortgage payments, which made the home affordable with just one income. They were about 31% of my gross. They also requested that she quit claim the house to me, which she did during the mod presses. I have been assured that everything was looking good up until the call I received on Friday.
  4. Evan Bedard

    Evan Bedard Call 1-800-779-4547 Loan Safe Mortgage

    I recommend you escalate your account with the executive's team and explain to them what was happened with your modification due to the BK.

    Chase Executive Team
    Jamie Dimon CeoPhone: 212-270-1111
    Fax : 212-270-1121
    E-Mail Address: jamie.dimon@jpmchase.com

    You may also want to escalate your concerns to FHA and let them know you have been kicked out of FHA HAMP due to the BK filing of a non-occupying borrower. Their filing should have no affect on the modification since it was based on your earnings and a quit claim deed was filed relinquishing all rights to the property.

    Here are some steps you can take to get help for an FHA loan;

    1) Call the FHA National Servicing Center (“NSCâ€) at 877-622-8525 to file a complaint:
    They are responsible for assisting FHA borrowers who have had difficulty working with their lender. You will need to provide the NSC with your FHA case number. Get your case number from your lender, or your FHA case number can be found in the top left corner of your HUD 1 settlement statement received at closing.

    2) Contact FHA Commissioner Carol Galante:
    Carol.J.Galante@hud.gov
    Direct: 1-202-708-2495.

    3) Call the FHA Outreach Center:
    1-800-CALL FHA (800-225-5342)


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