Fri, Jul 03, 2009
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Short Sale & Chapter 7 BK |
markorr
7 Posts
Member Since: 10/24/2004
Virginia Beach, VA
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Posted: 15:34 on 09-09-2008
Owner has been discharged from Chapter 7 BK, but mortgage debts (1st + 1 HELOC both with Chase) were not reaffirmed, which if I understand correctly means he is no longer liable for?
If so, what is the strategy for negotiating SS with lender? Who is the owner in this case? Is a SS even do-able?
The first is a VA guaranteed loan .. will the lender discount more than 88%?
The sale date is still scheduled for end of Sep and still list owner as grantee on Deed of Trust.
Advice .. pointers appreciated. THANKS!
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TheShortSalePro
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Oakhurst, NJ
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Posted: 16:13 on 09-09-2008
The owner is the owner until he is no longer the owner.
The owner can try to reaffirm the mortgages, offer a DIL, or try a preforeclosure sale or preforeclosure short sale.
The owner can list the home for sale and contact the lender for a workout, specifically asking for short sale consideration.
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cjmazur
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Member Since: 07/23/2003
Cupertino, CA
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Posted: 19:38 on 09-09-2008
How can secured debt be discharged?
It seems that the Chap 7 trustee would sell the sell the mortgage
or
The bank would be granted relief from the stay, and foreclose.
http://www.moranlaw.net/secured7.htm
(I have been stalking Chapter 7 Trustee sales for all sorts of stuff.
100K judgment for $500
royalty rights to 2 oil wells
etc.
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markorr
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Posted: 20:44 on 09-09-2008
So, from I understand, I should work this as a normal SS with the owner and lender (Chase), by putting SS pkg together, including hardship ltr?, W2's?, bank statements?, pay stubs? Seems silly if he's been discharged from BK-7 and home loans were no reaffirmed. Would lender just be interested in my offer letter and HUD-1 showing their NET?
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markorr
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Posted: 20:47 on 09-09-2008
cjmazur --- I just saw your link to MoranLaw site -- THANKS!!
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TheShortSalePro
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Posted: 08:05 on 09-10-2008
"How can secured debt be discharged? "
The "security" is the mortgage lien which remains attached to the real estate. The borrower's personal responsbility to repay the "debt" has been discharged as a function of bankruptcy.
The lender, who owns the mortgage can and will pursue foreclosure. The homeowner can act to payoff the debt, voluntarily, by DIL, sale, short sale, etc.
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cjmazur
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Posted: 08:14 on 09-10-2008
The security to holder is still "protected"...
Thanks.
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markorr
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Posted: 10:58 on 09-10-2008
Thanks. The primary reason for my post was to get advice on exactly what the lender might require for SS pkg on a property they plan to foreclose on since the owner has been discharged from BK-7. To me, it seems a bit silly or overkill to require hardship letter, 2 mos W2's, pay stubs, etc., if they know he just came out of BK-7. I get that the lender will foreclose, but my question is one focused on the SS paperwork requirements in this specific case.
Unless I'm misreading the responses, I will put together the normal SS pkg and send in to the lender.
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TheShortSalePro
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Posted: 11:05 on 09-10-2008
The first document you'll need is the court order lifting the automatic stay of relief. Then, the BK discharge.
Technically, you should have an updated, post BK listing agreement, and contract of sale.
All else the same as a non BK short sale application
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