I've ran into some rough times. I have about $34,000 in credit card debt. $30,000 on a 2nd mortgage. and $60,000 on a school loan. My wife who doesnt work owes about $24,000 in school loans and $2,000 in credit card bills. My first mortgage is $175,000. Add all that up and it spells trouble for a $50,000 salary supporting a wife with 2 kids. My home loan which is VA guaranteed is in foreclosure. I'm gonna loose the house which is vacant because I got laid off in the town I was working in and I had to move out of state for another job. I tried selling it but that didn't work in ths market. I tried renting it out but I ended up with tenants who didn't want to pay or move (squaters). The last tenants i had stole my refrigerator an all kinds of other stuff, even my darn pool pump (go figure). I'm scared. I don't really know what to do. I can't pay everyone and I don't know who to pay first. My problem is stability. I'm in the aviation maintenance industry. When i have a job it's great, really busy for a while with overtime, then when it slows down they lay you off. When you want to go back they start you over from the begining (benefits and time in service). I had a $36,000 garantee with VA for the home loan. Are they gonna come after me for that money. I'm thinking bankruptcy, so can I add the VA in the bankruptcy. I'm stupid for getting way over my head in bills, it was just too easy. The credit card companies kept raising my credit limit. I started with a low fixed APR but they raised my interest rate to 28% even though I was never late. I asked them why they did that and could they lower my interest rate back down. They said it was because I had a risky debt to income ratio and they can't lower it because I am on time so it seems like I'm not having trouble. Now my minimum payment which I could barely affor does't even cover the interest (Go figure). I really feel like a loser, but I sit and think that the credit card companies themselves preditorial lend. So I guess I am going to file chapter 7 bankruptcy. Hopefully with the new law I can wipe the slate clean except for the school loans. That is if they don't make me file chapter 13. I thought i would share this with everyone. I cried when i was writing this. Maybe I will feel better soon.
Question- Is the VA going to try and get their $36,000 back? What should I do about them?
Thomas, I feel for you and I know exactly what you are going through. Chapter 7 is definitely going to make life livable again. As far as VA goes, you have nothing to worry about. VA does not require any losses due to foreclosure to be repaid unless you are trying to reinstate eligibility for buying a new home using the VA loan.
Just to clarify, the $36,000 figure simply indicates full eligibility. VA insures 25% of the loan amount. So assuming that $175,000 was the original loan amount then VA could stand to lose up to $43,750. The loss amount is based on what the lender sells the house for.
We are in a simular situation, We have a VA loan of 157, a second mortage of 50, and we believe there is now a lien of 25, on the house.Not to mention credit card. If we foreclose and let the house go can they take his dav benifits to repay the loan?
I had my Home Foreclosed which had been acquired through a VA Loan. Any Idea how do I get an update on this. I have been going through a similar bad time due to the economic _____. Also, would this affect my Education Benefits? I am going back to school and don't know if that foreclosure going to affect in any way my GI Benefits!
Foreclosure will not effect your education benefits. If VA took a loss on the foreclosure they will attach the loss to your eligibility and should you ever want to use the VA Loan again you would have to repay the foreclosure loss to restore eligibility.
Our home is in foreclosure and we are trying to keep it! The VA rep has told us that if all else fails they will stop the foreclosure and take the house and let us keep it through some process they have in place. We will in turn loose our Va Eligibility. We are wondering if this is true?
I spoke to the VA on this as it was something I hadn't heard. VA does not intervene in that way. What VA will do is allow a lender to modify a loan. After you've had 1 modification and you require another one, VA has to evaluate it and sign off on it before the lender can modify it.
If VA took a loss on the foreclosure they will attach the loss to your eligibility and should you ever want to use the VA Loan again you would have to repay the foreclosure loss to restore eligibility.
Is there a time limit on the repayment status or is it for LIFE ?
In 2008 we bought a bank owned home for $408,000 using my husbands VA benefits (we live in So Cal). About 6 months after we moved in we discovered the slab foundation has serious damage (yes we had our own inspector as well as the VA inspector). We are seeing more and more cracks externally and internally as the months go by, we've had plumbing issues because of the cracked slab. We have nearly 65k in credit card debt and enrolled in a debt management program last July. We're managing to pay our bills but if we have an emergency we're having a difficult time keeping our head above water. We've been told the cost to repair the foundation is anywhere from $45,00-$100,000 and that was 2 years ago, the housing market has gone down further since,the house is worth about half what we paid, we don't know when we'd ever be able to afford the repairs and we just don't know what to do. We've considered bankruptcy and foreclosure but didn't know if the VA would be going after us for the $100k they stand to loose or ??
I have read your previous blogs about VA forclosures and that the VA "won't" come after you for any money, just eligibility... I have looked at the VA website, and to me it seems like they would come after you unless you requested a waiver. Please tell me I'm wrong...
I am in a 2 home, both upside down, situation. I bought my current home (VA loan) in 2007 before I sold my other home, hoping it would sell.. Well, it hasn't. My current home is more upside-down than the other.. I paid $217000 for it and they are still building new homes here now starting at $130000. Neighbors on both sides of me have already left their homes to forclosure because selling won't work. I also receive VA disab. and am afraid they will take that if I forclose... any suggestions..?
Originally posted by sailorwanabe: I have read your previous blogs about VA forclosures and that the VA "won't" come after you for any money, just eligibility... I have looked at the VA website, and to me it seems like they would come after you unless you requested a waiver. Please tell me I'm wrong...
Actually it is the law. They can not garnish Social Security or VA disability.
The bank or the VA can sue you in state court and seek repayment of the funds, depending on state law, but they can not touch your VA disability.
TITLE 38 > PART IV > CHAPTER 53 > § 5301
§ 5301. Nonassignability and exempt status of benefits
(1) Payments of benefits due or to become due under any law administered by the Secretary shall not be assignable except to the extent specifically authorized by law, and such payments made to, or on account of, a beneficiary shall be exempt from taxation, shall be exempt from the claim of creditors, and shall not be liable to attachment, levy, or seizure by or under any legal or equitable process whatever, either before or after receipt by the beneficiary. The preceding sentence shall not apply to claims of the United States arising under such laws nor shall the exemption therein contained as to taxation extend to any property purchased in part or wholly out of such payments. The provisions of this section shall not be construed to prohibit the assignment of insurance otherwise authorized under chapter 19 of this title, or of servicemen's indemnity.
I have a va loan on a house that I bought for 183,000 in 2008 and now I am 80,000 upside down. I refinanced to lower my interest rate but this still does not help with everything going on. If I can not make my payments and my house goes into foreclosure will I lose my education benefits? Will I have to repay the loan ? What are the ramificatons?
Two days prior to the date of this post, I was informed that my bank started the foreclosure process on my home. I have turned in the making home affordable package one week prior to being notified about the foreclosure. This is my first mortgage, and I am scared to death of losing my home. I am not sure what my options are, if any. I want to save my home, but I am not sure where I should start. I have heard of HUD being able to help folks out, and stop the foreclosure process.
I do make enough to make regular mortgage payments, however, I do not make enough to bring my mortgage current. I have asked my bank if it were possible to defer payments to the end of my loan, but they denied the request. It seems the only option, according to my bank, is to wait for them to decide whether I qualify for the making home affordable MHA.
Anyhow, I am depressed, and wondering if anyone here might be able to point me in the right direction. Thank you for your time, and I appreciate you taking a moment to read this this post.