Re: reaffirming mortgage. I did not (in 2010 BK) now want to do a loan modification and can't! Petition Crt / Lender or who??

Asked almost 2 years ago - New Berlin, WI

I would like to go through a HARP loan modification but 2 1/2 years ago did not reaffirm the loan in BK. I bought the property years ago with little down and the interest rate is way high because of this. I need to lower it. I'm told by Wells Fargo that I can't proceed and my BK lawyer says I can't reaffirm... too late. This doesn't seem right. Can I petition the court myself to reaffirm and then do the HARP? Caught in the middle here... help!

Attorney answers (5)

  1. Joseph Wrobel

    Pro

    Contributor Level 14

    6

    Lawyers agree

    Answered . You will not be successful petitioning the court. A reaffirmation can only be approved if it is signed, accepted and filed before the entry of the discharge.

    Your lawyer, by not having you reaffirm, did the right thing. Reaffirming makes you personally liable for the debt. You would not be able to "walk away from the property" without possibly owing money.

    Just because you want to go through a HARP loan modification does not mean it would be successful.

    Please be advised that the advice to you herein does NOT establish an attorney client relationship and that our... more
  2. Shannon E Wynn

    Contributor Level 14

    2

    Lawyers agree

    Answered . My colleague is correct that you will be unable to reopen your bankruptcy case to file the reaffirmation agreement. Therefore, you are either going to have to find someone rationale and reasonable at Wells Fargo or seek a professional to help. There are many housing counselors and community action offices who will help you negotiate a modification with your lender for free. I would contact your bankruptcy attorney and see if he/she is aware of an office or organization in your area.

  3. Edward W. Harness

    Pro

    Contributor Level 11

    1

    Lawyer agrees

    Answered . Previous answers are correct regarding the reaffirmation of the mortgage. Perhaps you shoud seek the counsel of a certified Housing and Urban Development Housing Counselor. The service is free and they can advise about ALL your options as they relate to modifying your mortgage.

    Disclaimer We are a debt relief agency. We counsel people regarding their debt. When appropriate we help... more
  4. Jay K. Nixon

    Contributor Level 14

    Answered . What the bank is telling you here is pure nonsense. There is no requirement in HARP or any other federal government sponsored mortgage modification program for past reaffirming of a mortgage three years ago. Instead, this sounds like an excuse to deny a request which would have been denied either way, regardless of reaffirmation. With a good payment record since your bankruptcy, you can self report such favorable information in your credit bureau files (and dispute its non-appearance in your files), even if the bureaus refuse to report via the feeble excuse of an ancient failure to reaffirm. In WI owner occupied, first mortgages, reaffirmations are nothing more than wasted paper since the only thing which they effect is the bank's right to pursue you for any deficiency balance left over following a foreclosure. Historically, those have never been pursued in WI regardless of reaffirmation, since WI law creates strong incentives for foreclosing banks to waive this right immediately when they start the foreclosure (which option WI banks nearly always take advantage of. Specifically, that incentive is a 6 month waiting period prior to sheriff's sale rather than a 12 month one otherwise required if they want to later pursue the homeowner personally for a deficiency judgment following completion of the foreclosure. In 35 years of legal practice, I have never seen a WI bank pursue such a deficiency option in a routine, owner occupied, standard mortgage foreclosure. The only exceptions have been in business loan cases, where a home has been pledged as collateral for the business. I am not your attorney and will not be taking any action on your case, although you may contact me during business hours at my office in Racine for clarifications. Also see me on the web at www.jayknixonlaw.com and read 15 years of prior answers to consumer legal questions, arranged by topic, at http://www.lawguru.com/answers/search/attorney/.... Answers may contain attorney advertising materials.

    Attorney answers on this pubic web forum are offered for public educational purposes only and do not make me your... more
  5. Alan D. Walton

    Pro

    Contributor Level 19

    2

    Lawyers agree

    Answered . You need to file a complaint with the new Consumer Financial Protection Bureau. Banks are refusing to lend for impractical reasons and this Bureau can help stop this. https://help.consumerfinance.gov/app/mortgage/ask

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