Posted on: 17th Jun, 2011 09:49 am
We filed Chap 7 BK, discharged 2 years ago, home was reaffirmed, and now home is going to be foreclosed, did not qualify for loan mod, want to keep home, but can't refi - are 5 months behind. Should we wait until they tell us to move, or keep trying to refi. or see what other options we have. We are upside down on the mort. If we foreclose, if bofa sells home for less than what is owed, are we liable for the remaining balance?
Thanks,
Thanks,
To be liable for the remaining balance depends on if you live in a recourse state or not. On your loan documents, there will be a clause stating power of sale. If you have this clause, then a deed of trust was used. Generally under the deed of trust, the only recourse for the lender is the property in collateral. Some states are judicial foreclosure states allowing deficiency judgements, some are non-judicial (meaning there is no court order to foreclose) IF you are upside down, and credit is shot, you will not be able to refi. If you are denied for the loan mod, try again. Try to contact NACA to help. Or try for the HAFA short sale or deed in lieu. Any of these options are better than foreclosure. Good luck!