Life after Chapter 7

[quinnpa]

Hello...got a tricky one for you

My wife and I just got our discharge from filing a chapter 7 bankruptcy which included our house. I figure we have about 6 months till we have to move and I was wondering if there was a lender who would do a mortgage for someone just coming out of a chapter 7.

I had got laid off for 8 months and got that far behind on my mortgage. My thinking is to just do a "deed in lieu of foreclosure" with my current lenders (80/20 loan) and then just "walk away". What I need to know though is can I get a new mortgage and if not, how long will I have to wait.

Thanks.

Particulars...

Income - $55,500/year combined (I've been back to work since Feb 1st)
Fico scores - 500 (mine) 550 (wife)
In 6 months will have about $8,000 for new purchase.

Whaddya think???

[quinnpa]

I should also point out that the reason we're not even trying to do a refinance is because we've only had the house for a little over a year and we have no equity. With our credit, it's damn near impossible to get 100% LTV to pay off the orignal mortgages.

[Haplo]

BK is better than a F/C on your credit, and you'll most likely be looking at 80% if you're lucky, 75% if you're not. Your score is going to need to be above that 500 mark though. Your income is going to be difficult as well, with the 8 month break. It's not an easy scenario as you already know. You can get a loan a day out of BK, but your score and the other details are going to weigh heavily on what you will be able to get on a loan.

Don't expect a very low rate either, this is going to be pricy. Deed-in-lieu may also be viewed the same as a F/C, even if it doesn't affect your score the same way the lender will likely view it just as badly. It could knock you out of some programs that you would normally be eligable for.

Good luck!

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Travis J. Halwachs
Renovation Specialist
217-553-6494

[quinnpa]

How would you suggest I proceed then? Try to sell the house? If not, do you know anyone who would do a refi with about a 90% LTV?

My wife had the idea to spend what would be one mortgage payment and finish our lower level (split level house) since it's mostly finished by the builder, just needs drywall, ceiling and flooring. Her opinion is that would dramatically increase the value of our home thus lowering the LTV to around 75%.

Thoughts??

[Haplo]

The problem you're going to have is that it's going to be difficult to get a loan at all. The value of your home *might* help, and if one mortgage payment would increase your value enough to give you an extra 15% of equity, well I'm not sure what happened in your history to get into your position.

The 75% line is going to be fun and exciting, because you also have to consider not only the loan amount with payoff, but also the cost of the loan. A company that'll do 75% with a buyout is *not* going to be cheap.

I'd recommend checking the other post, chow has made some comments over there with a similar scenario that may help you out.

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Travis J. Halwachs
Renovation Specialist
217-553-6494

[ForeclosureBailOut]

We may be able to offer another solution. We do foreclosure bailouts by purchasing the property and then leasing back to the seller for a specified period of time while they get back on their feet. If you're interested in learning more, email me or call. Would be happy to speak with you. We also pay broker referrals fees.

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Ron Jensen
US Financial Group, LLC
Foreclosure Bail Out Specialists
800-618-2433 (voice)

[Mac]

Ron, do you actually pay off their existing liens and hold the note yourself or do you catch them up and stick the title in a family trust of some sort?

_________________
You can't make a bad man good but you can make a good man better.

[ForeclosureBailOut]

We purchase the home with a fresh first mortgage, title in our names. We use some of the equity to get the sellers straightened around (obviously this depends upon the amount of equity in the home...our experience has been that $50K is pushing it), lease it back to them, generally for 12 months. At the end of that 12 months we can usually refinance them back into the home (since they can demonstrate 12 months vested interest) so they can take advantage of a lower LTV, no money out of pocket, etc. We sell it back to them at the same price we paid for the home originally.

Thank you for the question.

_________________
Ron Jensen
US Financial Group, LLC
Foreclosure Bail Out Specialists
800-618-2433 (voice)

[chow]

I had a call from a realtor just 4 days ago.

He said his "client" purchased a home, and was on title, but the seller of the private second, and the first -mortgtage holder-who had a balloon mortgage attached, wanted him to quit claim off of the property-unless he could refinance the whole note.

The "seller"
AKA the first and second note holder-proposed that the original note holder would be in first, the Notary would be in second, and the guy who lived in the home would be so far off left base, that no one could find him.


I don't know. I just ran thru a few violations of my own state laws, then went into the govie area, and then landed on home plate with

You're a Notary in this state and your ask me what???? Why???

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Kathy Grider

[Mac]

Thanks for your timely response.

If you don't mind me picking your brain for a second I have another question for you.

Do you find it hard to line up lenders for the end loan after a year? We are talking about borrowers with a foreclosure within approximately 13 months or so, correct?

_________________
You can't make a bad man good but you can make a good man better.

[chow]

[ForeclosureBailOut]

Chow, I'm not sure I understand the nature of your challenge. I'm offering a service, simple as that. If you have a property you wish to send me and discuss, I'll be happy to do so.

If the property meets our requirements, we'll offer to purchase the property, get the seller re-situated, and then sell it back at the end of the term for the same amount we purchased it.

It's very straight forward.

_________________
Ron Jensen
US Financial Group, LLC
Foreclosure Bail Out Specialists
800-618-2433 (voice)

[ForeclosureBailOut]

[ForeclosureBailOut]

I went back and re-read all the posts. I never saw the second post indicating that there is no equity in the home. This would not work in a program such as ours.

Chow, perhaps this is what you were referring to...

_________________
Ron Jensen
US Financial Group, LLC
Foreclosure Bail Out Specialists
800-618-2433 (voice)

[Mac]

Ron, my questions were purely to satisfy my curiosity. I have no bone to pick here.

_________________
You can't make a bad man good but you can make a good man better.