Q. I have been trying to get a loan modification on our primary residence through Chase for over a year now. They keep claiming that they do not receive my information, lost it or that I need to update it. This process is ridiculous and I’ve had enough. My wife and I have decided that we just want to walk away.
Our goal is to stay in this house as long as humanly possible in order to save as much money as we can to move to a new property. They have been playing games with us, so we will play games with them. I plan to pull every mortgage trick in the book.
My question is, ” How long can I stay in my house when I file for bankruptcy and stop paying my mortgage?”
A.This seems to be a common trend that I’m seeing more and more often. Homeowners who once wanted to save their homes by getting loan modifications are now deciding that the hassles and mortgage servicer shenanigans are not worth the fight. Many are getting fed up like yourself and deciding to walk away. To be perfectly honest with you, I do not blame them or you one bit.
Let me disclose to you that I am not a lawyer. You are definitely in a legal situation and the best thing for you to do would be to speak to a qualified lawyer in your state. Actually, you should speak to two or three good bankruptcy attorneys who understand the foreclosure laws.
Please keep in mind that current bankruptcy laws do not cover your mortgage on a primary residence. If you file bankruptcy it will only temporarily stall foreclosure proceedings for a short period of time. What happens when you file is that all your debts are covered under what is called an “automatic stay.” During this automatic stay your creditors are not allowed to contact you or proceed with any judgments. Since your mortgage is not covered under bankruptcy, your mortgage servicer will move to the court to have the mortgage released so they can legally proceed per your state’s foreclosure laws. Of course there is more to this process and that is where a lawyer comes in.
The time that you stay in your home will vary and there is no definitive timeline. I have seen some people get an extra three months and I’ve witnessed some people who extended this time to well over a year by filing multiple times or by having an extremely good lawyer who knows how to game mortgage servicers.
Many people are doing what is called a strategic default.
This is when you go through the foreclosure process with a strategy much like you are choosing to do.You do this by learning your state’s foreclosure laws and time-lines. You pretend to your mortgage servicer that you want a loan modification or short sale but in reality you’re just trying to buy time to later file bankruptcy at the last minute in order to buy more time. Playing the loan mod game and knowing when to file bankruptcy is the key; and doing it at the last minute may be best.
You can also join our mortgage forum with over 32,000 Americans just like you. Everyone is sharing information and helping one another through the foreclosure process. It will be great for you to journal your story and join the mortgage party!