My friend just got a letter from her mortgage co. Apparently he lawyer never sent in the reaffermation agreements that he and his wife signed. The letter stated that although they did not reaffirm the mortgage co would still service the loan in the same manner even though the debt was not reaffirmed. It also states that they will be expected to submit payments by the due date, and comply with all other convenants on the promissory note. And....the mortgage co will not hold them personally liable for the debt. This means that in the event of a default they will not seek a deficiency judgment abd will look only to the security property for recovery of the debt. In short...is this a good thing or a bad thing? Will it still be reported on the credit reports monthly? Can they forclose much faster (say if the debt is even less than a month late ect)?
It is a good thing. The terms of the mortgage cannot be changed because of the BK. The mortgage lien is a legal recorded instrument. As to the monthly reporting, that doesn't change either. It would be the same thing if there were a car loan that had not been reaffirmed.
So they would not foreclose any faster or they can not out of the blue? But they are not legally responsible now?
Re: Re: Laywer did NOT reaffirm mortgage :O They are legally responsible under the terms of the mortgage, but not under the note. If they were foreclosed the mortgage lien would be foreclosed and that's that,no deficiency. Same thing with a car. I never suggest that anyone reaffirm anything that has a recorded lien or mortgage if they can avoid it.
Re: Re: Laywer did NOT reaffirm mortgage :O Thanks. I guess what I am getting at is this - would they (the mortgage co) be faster to take an action, such as a foreclosure than if they DID sent in the reaffirmation.
Re: Re: Re: Laywer did NOT reaffirm mortgage :O If they knew they could NOT get a deficiency, then logically, they would be LESS inclined to push for a foreclosure.
