Just over 2 years post chapter 7. Need advice on getting out of this house and into something new...

OneHugeMess

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May 30, 2016
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The third is with a credit union. I talked to the manager of the collections department several months back because I've had similar thoughts since the beginning of this mess. Nice lady, but she told me that the goal of the board that makes those decisions is to guarantee that I have no chance to benefit from the situation. Said they would have no problem approving a short sale no matter how small of an amount they get because then they are sure that the house is out of my hands.

Said that if they were to accept a settlement, I could possibly hold on to the house and sell years later after it appreciates and end up coming out ahead. They'll won't allow that to happen. She told me I should try for a short sale.
Home prices are beginning to fall. I'd deal with them again, when prices have dropped by 10% - or 15% in your area. Then... offer them $2,500. I wouldn't offer them a cent more, and quite honestly, I would go out of my way to ignore any calls, or letters from them. Two can play at being difficult.
 

OneHugeMess

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May 30, 2016
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To answer your earlier question, whatever you do -- DO NOT TOUCH YOUR RETIREMENT FUNDS. No, it's not worth taking care of this. They are a third lien, and third in line to foreclose, and underwater. They have ZERO leverage. They know this. Not only that...

But your retirement funds are protected from Creditors in a Bankruptcy Filing & a Judgement. I would much rather you file for bankruptcy and strip this lien, or practically anything else, but pay them. Not only that, but your stealing from your future to give the house away. What is the point of that? Rob yourself, to enrich some investor or bank who never cared about you in the first place? Think long and hard about this.
 

AZ_Dreaming

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Apr 25, 2014
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I do appreciate the concern, but no worries about anyone calling or bankruptcy at this point, this credit union is the one who sued us - forcing the chapter 7 a few years ago. :rolleyes: And unfortunately I have first hand experience with the 401k loan as I just finished paying back $20k that I took out to pay off a credit card - only to file bk about a year into the 5 year repayment...

I understand that I don't have to pay any of the mortgages at this point. I should have just let the bank foreclose back in 2016 and then I would have been able to qualify for an FHA loan 7 months ago. But no use in worrying about the past.

At this point, I'm trying to find a way to get out of this house / neighborhood and into another one without having to find something to rent in between. There's too much bad history here for us to stay - I'll leave it at that. But there's seven of us and a bunch of cats and a dog plus 15 years worth of stuff to deal with.

Thanks for the input, I've been thinking long and hard about all of this for too many years...
 

OneHugeMess

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May 30, 2016
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Question - how would you feel about doing Seller Financing? If you have a 10% Downpayment, and a good explanation, as well, as being able to show that you've paid everything else (mostly) on time for the past couple of years, you probably could get a nice home, with a 5-6% Interest Rate on good terms.

Than... you could walk away from this home, rent it out, and let the first foreclose. Whenever the waiting period expires, you could than Refinance the new home (potentially in your significant others name only) into a New 30yr Fixed Rate - with a lower interest rate, and get a lower payment. That might be your golden ticket.

The other possibility I would consider - is finding a cosigner (like a parent) or someone who would do you the favor, and getting a loan only in your significant others name plus the cosigner. There are a lot of 3% - 3.5% down loan programs, with PMI -- that would let you buy something new. Once again, as soon as you get into the new home, you could walk away from the old, rent it out, and let the first foreclose.

I think both are far better options -- than draining your Future.
 

AZ_Dreaming

LoanSafe Member
Apr 25, 2014
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Nothing against seller financing. I've thought before that either that or lease to own might be our only options. There aren't too many listings that seem to offer it though. Makes sense, as I imagine that most people are in the position where they need the full amount of the sale to move on to their next home.

As far as your second option, I probably shouldn't use "I" and "we" interchangeably in my posts. Wife has been joint on pretty much everything for the past 25+ years so she's in no better position than I am. My income is almost 5 times hers, which is why I had thought earlier about trying to quit claim the house to her and buying another one on my own.

As far as draining my future, it's still only a 5 year loan. I'd go with a personal loan if anyone would give me one - LendingClub keeps sending me offers for $40k / 4 years, so that would be a possibility as well. But at least with the 401k loan, the interest goes back to me.
 

OneHugeMess

LoanSafe Member
May 30, 2016
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New question -- is your first & second, reporting on your credit report? When you physically look at the report, when does it say the date of removal?
 

AZ_Dreaming

LoanSafe Member
Apr 25, 2014
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None of the three report. All say included in BK. 1st was closed 11/15 (just after we filed and they stopped accepting payments while the bk was in process), 2nd is reported closed 3/15, and 3rd shows closed 2/14.
 

Erik Sandstrom

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It may honestly be the best thing to do (short sale) if there is no equity in the home right now without them agreeing to some type of settlement and of course if you have access to the funds to settle. Honestly, I'm starting to see 2nd lien holders become extremely ruthless with trying to foreclose on homes.