During the boom, many homeowners took out home equity lines of credit (HELOC) and are now struggling to repay those loans plus their mortgage.  Can a debtor discharge their HELOC in Chapter 7 bankruptcy and keep their home?  The short answer is no.  A debtor can discharge the home equity loan in Chapter 7 bankruptcy but they cannot discharge it AND keep their home.  However, if a debtor would like to keep their home, they may be …

Tags: Bankruptcy Chapter 7 Bankruptcy HELOC Home Equity Loan

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… advice.  One of the worse pieces of advice given to debtors considering bankruptcy is to get a home equity loan.  That could be a big mistake.  Here a few reasons why getting a home equity loan to avoid bankruptcy might not be the right move for you:

Typically, you can’t use debt to get out of debt. Anyone who has filed bankruptcy can attest to that truth.  For most debtors considering bankruptcy, their financial troubles are caused by two problems, 1) lack of income and …

Tags: Bankruptcy Debt Home Equity Loan loans

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… behind on their debt payments because of a job loss or reduced income, many are turning to the equity in their homes to their debts hoping that they can avoid bankruptcy.  But cashing out the equity in your home to repay debt may be a huge mistake here’s why:

When you cash out equity in your home to pay debt, you put your home at risk for foreclosure.  If you can’t repay that equity loan, the lender could foreclose.  And even if you were able to make payments on …

Tags: Bankruptcy Debt foreclosure Home Equity loans

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The Making Home Affordable foreclosure prevention plan was suppose to help millions of homeowners avoid foreclosure, however the foreclosure program has failed to attain it goals.  According to a Treasury Department report, 27 percent of homeowners taking part in mortgage modification trails are delinquent on their mortgage payments.  And while the foreclosure prevention plan was designed to help …

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According to an article in the Star-Telegram, the Making Home Affordable program continues to fail to hit the mark in preventing foreclosures on any significant scale.

The article said:

“As of last month, more than 360,000 borrowers were enrolled in three-month trial loan modifications, out of about 570,000 who received offers. Only about 85,000 homeowners have had their loans refinanced under the Obama plan.”

Originally this foreclosure …

Comment by Jacob Decker: … when attempting loan modifications. Please do yourself …

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Using your home as an ATM to pay off your credit card debt could be a huge mistake.  When you take the equity out of your home to repay credit card debt, you are in effect turning an unsecured loan (credit card debt) into a secured loan (home equity loan).  Remember, a debt collector pursuing you for payment of credit card debt cannot attach your assets without a filing a lawsuit against you and winning a …

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According to an article in the Star-Telegram, the home buyer tax credits have been approved and are expected to be signed into law by President Obama. For first-time home buyers (or anyone who has not owned a home in the past 3 years), legislators extended a tax credit of up to $8,000 which was originally scheduled to expire at the end of the month and added another tax credit of up to $6500 for home buyers who have lived in their current home …

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… According to the Center for Responsible Lending, the proposed legislation allowing mortgage loan modification in bankruptcy could help 600,000 families avoid foreclosure.

Under the proposed plan allowing mortgage loans modification in bankruptcy, only homeowners with an existing mortgage would be eligible for mortgage loan modification in bankruptcy. Also, the homeowner would have to prove to the bankruptcy court that he/she attempted to modify the mortgage loan with the mortgage …

Comment by jede ferrani: … for modiyfing your home loan. Thanks for sharing. Many …

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How many of us have been through wanting to take out a loan; but just were unable to translate the legalese to simple layman’s English? What eventually happens? We sign away on the dotted line without truly understanding what we are agreeing to. Well help is here for Texans. The Office of Consumer Credit Commissioner offers plain language loan contract modules to the public at http://www.occc.state.tx.us/pages/Legal/plain_lang/index.html

What …

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A Loan Modification is a permanent change in one or more of the terms of a homeowner’s loan. It allows the loan to be reinstated, and results in a payment the homeowner can afford.

The homeowner must reach an agreement with the lender to modify the loan. Generally the lender will be a little reluctant to agree for a loan modification as modification typically results in less interest.

The …

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… homebuyers will:

-Pay an upfront mortgage insurance premium of 2.25 percent of the total loan amount, up from the current level of 1.75 percent. A borrower taking out a $200,000 mortgage would pay a $4,500 fee, for example, rather than the current fee of $3,500. Borrowers will still be able to wrap these fees into the total amount borrowed. FHA officials also plan to ask Congress to increase the maximum annual premium that FHA can charge.

-Need a credit score of at least 580 to …

Tags: Delinquent Down Payment FHA Foreclosures New Home Loan

Could your neighbor’s foreclosure affect your ability to resell you home even though you are not personally facing foreclosure?  Maybe. Many homeowners are finding that the large amounts of foreclosures in their neighborhood are having an indirect affect on their ability to resell their home at a profitable price or to break even.

When a mortgage lender has a home appraisal done, the value of that home is determined in part by what similar houses in the …

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