[araada]

One year ago declared Ch 13. For past month have been unable to pay mortgage and have house on market. Cannot continue to make monthly mort while waiting for sale. Been told if it goes to foreclosure they would start bid at what is owed (approx 80k) real estate agent is asking 120 which is 15,000 less than value. Parents cosigned. How will this effect them? Will mortgage company go to them to make payments while house waiting to sell? Or will they be responsible for any fees if this ends up at a foreclosure auction?

[Fr_Chuck]

Yes, they can come after them as co-signers and can report this on their credit I would ask if you can' make payments why you are not trying to sell it for like 99,000 or even 85,000 to get it sold.

[pacific nw]

One year ago declared Ch 13. For past month have been unable to pay mortgage and have house on market. Cannot continue to make monthly mort while waiting for sale. Been told if it goes to foreclosure they would start bid at what is owed (approx 80k) real estate agent is asking 120 which is 15,000 less than value. Parents cosigned. How will this effect them? will mortgage company go to them to make payments while house waiting to sell? or will they be responsible for any fees if this ends up at a foreclosure auction?

You can always call the bank and ask them if a sale date has been set for the property. They will be professional and tell you if a sale date has been set and how much it is to reinstate. They don't like you, they don't dislike you - they just want to get paid.

The value of a house is what somebody is willing to pay for it. If it has been on the market for 6 months, and you are asking $120,000 with no offers, then it isn't worth $120,000.

Usually a mortgage is paid through the chapt 13. If you have an agreement outside of the chapt 13, the answer is different than the following:

The Bank would have to have a Relief from Stay in order to sell the house at auction. If you miss too many payments, they will file a motion with the court for Relief. You have an opportunity to correct the missed payments or contest the Relief. It takes a month or two for the process to complete. The bank can then set up a sale date. If you can bring the bank current during that time, the bank will most likely reinstate the loan, but not necessarily.

The normal opening bid is the amount owed on the property plus missed payments plus late fees plus legal fees plus unpaid property taxes. It is almost always more than the original mortgage amount.

The bank doesn't want the property. They will sell it if they think the only way to protect their interest is to sell it.

You and any co-signers have trashed credit at this point. It is being reported as "in foreclosure" or "in bankruptcy" on your credit reports. Once they house goes to foreclosure sale, it will take about two years of making payments on time on all of your bills before you can qualify to buy a house again. Don't listen to the "you'll never be able to buy a house again" or "it will be 7 years or 10 years" stuff. It takes two years of paying ALL of your bills ON TIME before other lenders will look at you for a mortgage.

Whether the bank will go after any co-signers depends on whether they get paid off in full at sale. They may, they may not. Just depends if they get paid off in full, or are still owed money. It is likely they will or have tried to get the co-signers to make payments, but when the property is included in a chapt 13, their hands are tied. The bank has little option outside of what the judge will allow. The chapt 13 states that you are making the payments. If you drop out of the chapt 13, they then can go after the co-signers as well.

Talk to your bank and find out the status of the loan and to your attorney to find out your options.