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  1. #1
    Join Date
    Sep 2009
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    1

    Default Post Bankruptcy Negotiate Upside Down Second Mortgage

    My question involves a foreclosure in the State of: California

    Hello,

    I filed bankruptcy chapter 7 in dec 2008.

    My house is worth about $400k. I owe $440k on my first with BofA. I owe $190k on my second with GMAC.

    I understand that although GMAC has a lien on my house, I have no personal responsibility to repay the loan. I was hoping that this might give me leverage in negotiations to settle this debt.

    Does anyone know how to go about negotiating. I was hoping to settle for 10 to 20%. When I called them they wouldnt talk to me because I never reaffirmed the loan. I was thinking that I would be willing to reaffirm the loan for 10 to 20%.

    Also, Will they foreclose on me?

    And, does my loan continue to gain interest. I have been told tghat it will not. I cannot afford to pay it and have stopped making payments.

    Thanks so much.

  2. #2
    Join Date
    Sep 2005
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    Posts
    98,846

    Default Re: Post Bankruptcy Negotiate Upside Down Second Mortgage

    I think there's a good argument that, by not signing a reaffirmation agreement, you avoid personal liability on the note. But they are under no obligation to negotiate with you, and can still foreclose on the note - your failure to sign reaffirmation doesn't remove their lien. Your choice to stop paying them will probably inspire them to look at the economics of your situation - that is, if they stand to recover more money by foreclosing than it will cost to foreclose, or if they will wait and see if you default on the primary mortgage or if the market rebounds, or something else happens.

    What will they do? Unfortunately, I don't know their policies for this type of case.

  3. #3
    Join Date
    Jan 2008
    Posts
    164

    Default Re: Negotiations on Second Mortgage After Chapter 7 Bankruptcy

    DKA976 if you surrenderd your home in the cht 7 you are not liable for the loan? As i have done also 12/08

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