Posted on: 19th Apr, 2011 06:10 pm
Ok, I currently live in a home that is killing me. It is about $100K less than comps in the area and I cant get out of a 9.25% rate because no lender will touch me because of being upside down. I went to apply for a home loan and it seems underwriting will only give me $175K for a new home beause they said I still make pymts to my current home and need to include both.
Here is the thing - my current home I live in was included in BK and no reaffirmation agreement was signed. I am on the Pay-n-Stay program. My name is still on the title but again, the home was included in BK and not reaffirmed. Basically its like this. If I quit making a payment or walk away, my lender can not come after me because of it included in the discharge.
Why do I have to disclose my payment for the current home which is obviously killing my for debt-to-income ratio for the new loan I am seeking?
Here is the thing - my current home I live in was included in BK and no reaffirmation agreement was signed. I am on the Pay-n-Stay program. My name is still on the title but again, the home was included in BK and not reaffirmed. Basically its like this. If I quit making a payment or walk away, my lender can not come after me because of it included in the discharge.
Why do I have to disclose my payment for the current home which is obviously killing my for debt-to-income ratio for the new loan I am seeking?
Hi TReisdorf,
As the home is still in your name, the underwriter is taking it into consideration while giving you a loan. You can surrender the property to the lender who will sell it off so that the property won't remain in your name any further. In that case, you can apply for a higher loan amount.
Thanks
As the home is still in your name, the underwriter is taking it into consideration while giving you a loan. You can surrender the property to the lender who will sell it off so that the property won't remain in your name any further. In that case, you can apply for a higher loan amount.
Thanks
Hi TReisdorf86,
If you have already included the home in BK d you are finding tough time paying the reduced payments,you can just stop paying the money.Your name will eventually be removed from the home but you will have to vacate the home as well.SO before taking step in this regard you can search for the rental house.Pay deposit amount (if any )to the new homeowner whose property you wish to rent,and once you settle down in the rental property then only you can stop paying for the mortgage.
So you will not face any trouble and you can smoothly go ahead with your plan to purchase a new home.
Feel free to ask any further query if you have....
DIPA
If you have already included the home in BK d you are finding tough time paying the reduced payments,you can just stop paying the money.Your name will eventually be removed from the home but you will have to vacate the home as well.SO before taking step in this regard you can search for the rental house.Pay deposit amount (if any )to the new homeowner whose property you wish to rent,and once you settle down in the rental property then only you can stop paying for the mortgage.
So you will not face any trouble and you can smoothly go ahead with your plan to purchase a new home.
Feel free to ask any further query if you have....
DIPA
Thank you for the replies but I am a little confused.
jameshoqq says "surrender the property to the lender" and dipaligopale says "you can just stop paying the money".
If I do this, isnt this the same as letting the home go into foreclosure? Afterall, I doubt my name will come off the title until the house is sold via Sheriff sale and once that happens - the clock starts ticking for me to get an FHA which I believe is a 3yr waiting period.
If surrending the property is also the same a short sale, I believe FHA is looking at SHort Sales the same as foreclosures and again, I need to sit for 3 yrs.
Now if the lender is willing to surrender the property TOMORROW, I am all game :-)
jameshoqq says "surrender the property to the lender" and dipaligopale says "you can just stop paying the money".
If I do this, isnt this the same as letting the home go into foreclosure? Afterall, I doubt my name will come off the title until the house is sold via Sheriff sale and once that happens - the clock starts ticking for me to get an FHA which I believe is a 3yr waiting period.
If surrending the property is also the same a short sale, I believe FHA is looking at SHort Sales the same as foreclosures and again, I need to sit for 3 yrs.
Now if the lender is willing to surrender the property TOMORROW, I am all game :-)
Hi Guest!
Welcome to forums!
Once you stop paying the mortgage, the lender can take foreclosure actions against you and will ask you to surrender the property. You're correct - unless the property is sold off, your name will remain on the property deed. After the foreclosure, you'll have to wait for 2-3 years in order to qualify for a new loan.
Feel free to ask if you've further queries.
Sussane
Welcome to forums!
Once you stop paying the mortgage, the lender can take foreclosure actions against you and will ask you to surrender the property. You're correct - unless the property is sold off, your name will remain on the property deed. After the foreclosure, you'll have to wait for 2-3 years in order to qualify for a new loan.
Feel free to ask if you've further queries.
Sussane
Thank you Sussane, I was thinking that was the case. Once I surrender the property the clock starts all over again and I need to rent for 3 years. Luckily we have redemption periods in our state so I can live free for almost a year before renting.
Hi TReisdorf,
As you've redemption period, you can stay in the property without renting. Moreover, you should take steps to improve your credit so that it becomes easier for you to rent the property after a year.
As you've redemption period, you can stay in the property without renting. Moreover, you should take steps to improve your credit so that it becomes easier for you to rent the property after a year.
Thank you all! I conculted a few Real Estate attorneys as it seems I just cant get the straight answer if I can disclose my payments or not when the home was IIB and no reaffirmation was signed. As someone said, politics is getting in the way of legality.
Once I find out from an attorney I will be sure to update you all!
Once I find out from an attorney I will be sure to update you all!
Do keep the forum updated about your experience!
What I am finding is there is really no rime-or-reason why some lendersunderwriters give loans and some don't It seems (as I heard previously) that underwriters are mixing politics against legality. In fact I heard that from a Real Estate attny. He said there is really no law that says a underwriter can use my home payments and one can not. Its the discretion of the lender, FHA and what my plans are with the current property.
I am finding that in some forums there are success stories from fols with my situation and stories, well, like mine. Its sort of the diamnond in the ruff. You might find a savy brroker who understand the process and knows how to work with the lenders. Its unfortunate the lending and underwriting business is as grey as the Minnesota skies in January. there is no clear cut explanation besides the fact you have to keep trying. One thing I can say is that I think I know more then some mortgage brokers when I have to reiterate the guidelines of FHA and Convential following CH7 BK or foreclosures.
Oh well, will keep chomping at the bit and yes, will keep the updates gong!
Thank you
I am finding that in some forums there are success stories from fols with my situation and stories, well, like mine. Its sort of the diamnond in the ruff. You might find a savy brroker who understand the process and knows how to work with the lenders. Its unfortunate the lending and underwriting business is as grey as the Minnesota skies in January. there is no clear cut explanation besides the fact you have to keep trying. One thing I can say is that I think I know more then some mortgage brokers when I have to reiterate the guidelines of FHA and Convential following CH7 BK or foreclosures.
Oh well, will keep chomping at the bit and yes, will keep the updates gong!
Thank you
Thanks for the update, TReisdorf!