Mortgage, Foreclosure, Bankruptcy, Divorce??????

Date: Sat, 06/21/2008 - 04:47

Submitted by jennifer_bailey75
on Sat, 06/21/2008 - 04:47

Posts: 154 Credits: [Donate]

Total Replies: 16

Hello,
I made a couple of posts in the PDL section, but I have another question.
My situation is a total mess, and some of the problems have been repeats. I'm ready to make the changes I need to in order to get out of this cycle. Here is the chain of events..
My husband and I bought a home about 4 years ago. It looked like a dream come true. Built in 1890 with 4 bedrooms, 3 full baths, almost 2500 sq feet of living space, a full finished basement with bathroom number 3 having a whirlpool tub in the basement. It was beautiful. $74,900... Sound too good to be true??? It is.. The house had foundation problem, in that the cinderblocks were crumbling, there were several drug houses, and prostitution houses across the street. It turned into a big mess. Our mortgage company "adjusted" the documentation because we did not have a down payment, so we ended up with a second mortgage from the outset of the loan. We quickly fell behind when we found that the taxes and insurance were not included and after 3 months the mortgage company insisted on using their own insurance company increasing out payments from $448 to $880 a month... We were behind for most of the mortgage. I would set up payment arrangements, giving them all of our financial information, not being smart and figuring it out on my own, they would over budget us, and we'd end up further behind.

I contacted a company that claimed they would help us get the mortgage straightened around, (can't remember the name of it anymore at this point, if I do remember, I'll post it) They claimed they would get the mortgage company to reduce the interest rates, consolidate the two loans, forgive the interest and fees, or completely rework the loan all togethers. We paid them about $2500. They never did anything, claiming they could not get in contact with the loan company. At this time, after 3 years, our house apraised at $60,000. I think they falsified the appraisal in the beginning.
In the mean time, my husband of almost 10 years decided that he wanted to leave (it had nothing to do with financial issues, more with his girlfriend and his being bipolar). He promised to stay until the mortgage situation could be fixed, and possibly get the house financed in my name only. He backed out on that promise and moved out on our sons 7th birthday.
(Think it's bad? It gets worse)
I struggled to get someone at the mortgage(America's Servicing Company) company to help me, to no avail. They were rude, condesending, and accusitory. I explained the situation in full, but they refused to budge. I would have to pay them $1400 a month for a year then they would drop the payment to $880 after the first year or they would foreclose. ( I only made $8 an hour at that point)

I moved out of the house in May of last year after I was fired from my job (because they didn't want to "deal with another single mother" Yes I know I should have sued them, but I didn't have the will power, or the frame of mind to care at that point). I lived in the house for about a month and a half until I was placed at a job by a temp agency.

I found a rental place close to my job and my parents. The happy part is they hired me full time and permanent and I couldn't be happier with the people I work with or the job I'm doing.

More bad came though.. I had hired a lawyer for the divorce, who refused to return my phone calls. My husband's lawyer had sent her paperwork that I needed to fill out for Deed in lue of foreclosure, but she never contacted me to let me see them. She eventually was arrested on felony charges of trying to sneak a friend into the prison to see her boyfriend.. :shock: Then tried to send a collection agency after me saying I owed her more money. She only showed up to court once, for our initial hearing (he filed so she didn't have to do that paperwork) and I never heard from her again.

At this point, it's been a year and a half since my husband walked out. The mortgage has gone into full blown foreclosure, went up for sherriff's sale, (but they said they kept cancling the sale????) and now I don't know the status. We cannot finalize the divorce because we may end up having to file bankruptcy together. ( the only thing in dispute is the 401K) I'm at a loss. I don't want to have to file bankruptcy, and the mortgage company won't tell me much. They can't even tell me what exactly we "owe" on the house now. They refused to accept "Short Sale" offers in the past. We had the house on the market for almost a year and had 3 or 4 short sale offers. The Deed in Lue of Foreclosure never was accepted. Not to mention there is the smaller second mortgage to contend with as well.

Now after all the dirt laundry is aired.. the question: So is bankruptcy really my best option? I don't really have any other bills except for the PDLs...

I know it's a mess, and it's very depressing. I'm scared, tired, and depressed, and I'm beginning to feel resigned to the fact that my life will always be in shambles. I just want to not have to worry, and I'm tired of feeling like I fail with everything I do. I don't want to fail my son. Sorry for all the unnecessary facts, but I felt like I needed to full explain the situation. Any suggestions or advice would be appreciated. Thanks for letting me vent :(
Jen

Hi Jen - I can actually understand and sympathize with your

Hi Jen -

I can actually understand and sympathize with your situation, having been through something very similar myself - though not all in the same order (husband left first, then I bought a house on my own and got worked over by an unscrupulous mortgage broker, which ended up putting me into bankruptcy.)

At this point, I think it would be worthwhile to speak to a bankruptcy attorney, and soon - especially since you don't know where the foreclosure situation lies. I normally wouldn't recommend bankruptcy as a first option, because I've seen firsthand what it does to someone's credit rating - but sometimes, it's quite possibly the only option.

I don't know for certain that it's the only option for you, however - I know other members will be along to post other helpful information - I just wanted to give you some hope that things are not as bleak as they seem. It wouldn't be the end of the world if you did have to file bankruptcy - it would actually give you a fresh start without the worry of being pursued by the mortgage company for the mortgage on your old house.

Keep your chin up, Jen - things may seem like they're all going wrong for you right now, but they WILL eventually get better. You've started down the road towards a new life, it's just going to have a few bumps along the way - but it will all work out!