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Foreclosure/reinstatement/bankruptcy

  • Thread starter Thread starter jbj117
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jbj117

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What is the name of your state?What is the name of your state?What is the name of your state? Tennessee

When I realized I was unable to make mortgage payments, at the 60-day past due mark, I contacted the lender. Two weeks later they sent me a financial packet for a workout agreement, which I completed and faxed to them a week later. The following week I got a job, one week later I submitted a mortgage payment which was returned a week after that. I contacted the lender to find out why the payment was returned and was informed the property was turned over for foreclosure. The lender claimed to have not received my faxed workout packet. I have no proof of the fax, since my fax machine does time stamp nor provide a printed fax report. My mistake was in not calling to verify receipt of the fax. I refaxed the packet, but they denied a workout plan because I am in a temporary (6 month) employment position. They waited until the day before the deadline on the original reinstatement amount to inform me they could not work out a repayment plan, even though they had the packet for over two weeks and knew immediately that I was in a temporary employment position. Now, foreclosure sale date is 2 weeks away. I have 2/3 of the funds required for reinstatement. If I can't come up with the balance in time, would filing Chapter 13 be the next best option? How far in advance of the sale should bankruptcy be filed? Do I need to hire an attorney for reinstatement, since I've heard that even if the reinstatement amount is paid, it is not uncommon for a "math error" or some other glitch to occur so the foreclosure can proceed. I've spoken with a foreclosure assistance company, but am hesitant to use them to negotiate on my behalf, especially since there is no guarantee they can stop the foreclosure in time. I've heard so many horror stories and contradictory information I don't know who to trust or believe anymore. Can someone please offer a shred of insight on how to best deal with this nightmare? I have a $47K mortgage balance, and 70K+ equity, which is the only financial asset I have after spending the past 4 years being a fulltime caregiver to my disabled mother, until her recent death. Is there any way to protect myself at all? Thank you.
 


HomeGuru

Senior Member
jbj117 said:
What is the name of your state?What is the name of your state?What is the name of your state? Tennessee

When I realized I was unable to make mortgage payments, at the 60-day past due mark, I contacted the lender. Two weeks later they sent me a financial packet for a workout agreement, which I completed and faxed to them a week later. The following week I got a job, one week later I submitted a mortgage payment which was returned a week after that. I contacted the lender to find out why the payment was returned and was informed the property was turned over for foreclosure. The lender claimed to have not received my faxed workout packet. I have no proof of the fax, since my fax machine does time stamp nor provide a printed fax report. My mistake was in not calling to verify receipt of the fax. I refaxed the packet, but they denied a workout plan because I am in a temporary (6 month) employment position. They waited until the day before the deadline on the original reinstatement amount to inform me they could not work out a repayment plan, even though they had the packet for over two weeks and knew immediately that I was in a temporary employment position. Now, foreclosure sale date is 2 weeks away. I have 2/3 of the funds required for reinstatement. If I can't come up with the balance in time, would filing Chapter 13 be the next best option? How far in advance of the sale should bankruptcy be filed? Do I need to hire an attorney for reinstatement, since I've heard that even if the reinstatement amount is paid, it is not uncommon for a "math error" or some other glitch to occur so the foreclosure can proceed. I've spoken with a foreclosure assistance company, but am hesitant to use them to negotiate on my behalf, especially since there is no guarantee they can stop the foreclosure in time. I've heard so many horror stories and contradictory information I don't know who to trust or believe anymore. Can someone please offer a shred of insight on how to best deal with this nightmare? I have a $47K mortgage balance, and 70K+ equity, which is the only financial asset I have after spending the past 4 years being a fulltime caregiver to my disabled mother, until her recent death. Is there any way to protect myself at all? Thank you.

**A: yes, you need an attorney.
 

rainmand

Member
Filing a chapter 13 will halt the foreclosure process and enable you to restructure your debt so you can get caught up. It'll ding your credit so you'll want to avoid it if you can. Lender's dislike foreclosures more than chapter 13's, so the better of the two evils is the bankruptcy option (from a "credit perspective"). Bankruptcy Attorney's will recommend for you to file ASAP when a house is in NOD (Notice of Default).

Have you considered refinancing your house? You may be able to pull out enough equity to stop the foreclosure process, pay off the current Lender and avoid a chapter 13. Several home loan products exist that enable the borrower to refinance their house when it's in NOD. The loan fees and interest rates are higher due to the risk, but sometimes it's a good option when compared to other less desireable options.
 
J

jbj117

Guest
Raymond, thank you for your helpful reply. I have considered Chapter 13, but am holding it as a last resort. I just spoke with my ex-husband who has offered to lend me the balance needed to reinstate, so I'll be able to forward funds within the next 3 days. Meanwhile, I'm still concerned about whether I need an attorney for the reinstatement process, as has been recommended by several sources. The naive part of me wants to believe that paying the reinstatement amount will fully restore security, but my pessimistic side is leaning towards agreeing with the need for an attorney.

I've talked with several lenders about refinancing, but, given the short time-frame in which to process a loan, I'm leery of going that route for fear of being told at the last minute that the loan won't go through for whatever reason.

It seems reinstatement is the safest route. Do you agree, and do you know how likely it would be that the reinstatement funds would be rejected?

Again, many thanks for sharing your knowledge and your time.

Jennifer
 

rainmand

Member
>It seems reinstatement is the safest route. Do you agree, and do you know how likely it would be that the reinstatement funds would be rejected?

Reinstatement is definately the best way to go. Thank goodness you have a good relationship with your ex-husband. I'm qualified to give advice on mortgage/bankruptcy related questions, but don't feel comfortable going beyond that. You may want to contact www.legalhelpers.com for assistance. They'll put you in contact with a Bankruptcy Attorney in your State and you can consult with the attorney for free via the telephone.

>I've talked with several lenders about refinancing, but, given the short time-frame in which to process a loan, I'm leery of going that route for fear of being told at the last minute that the loan won't go through for whatever reason.

I understand. I'd be lerry too if I was in your position, but it's worthwhile mentioning these types of loans are designed to move fast and the fall out rate is small. How are you going to pay your ex-husband back? You may want to consider a normal refinance after the NOD is resolved.

Hope this helps. Good luck Jennifer.
 
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