QUESTION
What options do we have if the bankruptcy home wasn't reaffirmed?
Asked on Jan 27th, 2016 on Bankruptcy - Ohio
More details to this question:
In 2010, we filed chapter 7. In the statement of intention, we retained the property and wanted to reaffirm the house. According to the mortgage company, the lawyer never sent a letter of intent to them and they charged it off. The final court papers shows that it has been reaffirmed, but it has not. Now, I cannot refinance the house, as no bank will touch a charge-off, and we were wondering if there's any possible way to rectify the situation. I am aware that we can sell, however, it makes getting financing for another home very difficult as we are wanting to move out of state. Is there anything we can do?
6 ANSWERS
First of all, it is your MORTGAGE company's decision of whether to offer you a reaffirmation in Chapter 13. Your lawyer cannot demand that your mortgage company offer you a reaffirmation. Secondly, you should not take legal advice from customer service people at your bank. They are uneducated about bankruptcy, are not authorized to practice law, and have their own agenda. Thirdly, if you want to refinance, go to another institution. Your bank is telling you they no longer wish to have you as a customer or offer you a refinance. Best deals may be with a local credit union.
Answered on Feb 25th, 2016 at 4:37 PM
Pay an experienced BK lawyer for an hour of their time to review your bankruptcy file. Something doesn't sound right, but without reviewing the file in its entirety, all anyone can do is guess. Good luck!
Answered on Feb 25th, 2016 at 4:36 PM
2 Awards
You cannot refi with the bank you did not reaffirm with unless you reopen your case and reaffirm. That will be expensive ($1,500). You could attempt a refi with another bank. If you have equity in the house this shouldn't be a problem. Or, you can sell the house, either a short sale or conventional sale depending on if you have equity.
Answered on Feb 25th, 2016 at 10:19 AM
Bankruptcy Attorney serving Livonia, MI
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Charles J. Schneider, P.C.
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You do not need to do anything. You are in the best of all worlds. If you did not reaffirm do not make further mortgage payments and save them for the down payment on the next house you purchase. A down payment should improve your chances of obtaining a loan.
Answered on Feb 25th, 2016 at 9:53 AM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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Some ideas on what you can do: Contact the lazy lawyer and demand that he take steps to rectify such as moving to reopen the case (for which the court charges $300, which he should pay if his negligence led to this problem) for the purpose of reaffirming. You should follow up each thing he does, though. Use the court's record of the reaffirmation to notify each of the three major credit reporting agencies that the debt was reaffirmed. Complain about the lawyer to the Office of Lawyer Regulation. Put a message of up to 100 words in your credit file at each of the credit reporting agencies, reciting in brief what happened and showing that you have made all the required payments just as if the debt were reaffirmed. Good Luck
Answered on Feb 25th, 2016 at 9:53 AM
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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If there is a reaffirmation agreement on file with the court, signed by both parties, then it was reaffirmed. Regardless, if you pay off the amount of the lien, then report that the charge off was error then your credit report should show it correctly.
Answered on Feb 25th, 2016 at 9:15 AM