QUESTION
Can a mortgage not reaffirmed and not being reported as being paid count against your debt to income ratio?
Asked on Oct 05th, 2016 on Bankruptcy - Wisconsin
More details to this question:
I am trying to buy another house and wondering if my current house in which I did not reaffirm after bankruptcy can be counted towards my debt to income ratio when it is not being reported by the lender as being paid at all and on time. My bankruptcy was discharged 6 to 7 years ago.
3 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Since you have no legal obligation to pay, the discharged mortgage should not count against your debt/income ratio.
Answered on Oct 27th, 2016 at 7:53 PM
I would not expect this to be a legal issue but rather a discretionary decision to be made by each individual lender.
Answered on Oct 27th, 2016 at 7:52 PM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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Well, in a strict legal sense you no longer 'have' the debt, since it was discharged, and the legal situation is that you are now voluntarily repaying. So long as you do that, without any delinquencies, the lender must treat the debt as if it is in effect-except that they need not report payments to the credit bureaus. My reasoned guess is that the debt on your home would not enter into your credit score-but you can get better information by contacting one (or all three) of the major credit bureaus yourself.
Answered on Oct 27th, 2016 at 7:52 PM