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Should I File Bankcuptcy ?

Double D

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This guy represents a large number of the american population. This is not an out of the ordinary situation. There are many programs availible to people who dove in irresponsibly and got in over their head. Alot of people who grew up with nothing get out of control when they come in contact with money. I know first hand. Maybe he will learn and maybe he wont. Bankruptcy will not teach him anything and the possibility of getting right back in this situation is high. Only manning up and being responsible and taking care of this debt will teach you anything. I hope you can figure it out and get back on track. I know its a hard place to be in. Good Luck.........
 
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8 SNAKE

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Your a loser..... You deserve this sorry to say it.

First, you need to learn the difference between your and you're before calling anyone else a loser. Otherwise, you'll just make a fool out of yourself. ;)

Second, the OP came on here looking for help and advice just like you did. Your personal situations may be different, but your goals were the same. Ponder that for a bit and see if your perspective changes.
 

8 SNAKE

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Is that even possible? If so, how?

I assume that you're talking about the $385k mortgage with a $40k/yr salary? That happened a lot. No document loans, baby! Back then I probably could have sold my house to my dog if I tried hard enough.
 
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hakrjak

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It is possible to dig yourself out and start over, but it's not an easy road and can take years of hard work and determination. I've been in debt $25k on credit cards twice in my life, and dug myself out completely. (Mostly due to starting failed businesses with no money and financing them with plastic). Last time was around 5-6 years ago. I haven't even had a car loan since, and pay everything off each month.

Claiming bankruptcy is no longer an easy way out, as they will just restructure your debts and come up with a plan for you to pay most of them back. I've never had to do this, but -- You are better off meeting with your bankers & creditors and trying to get them restructured yourself at this point. If you genuinely can't pay them, sometimes they will be willing to work with you. Avoid getting that Bankruptcy on your credit report at all costs. They say it only lasts 7 yrs, but that's just the credit bureaus... And there are no guarentees other companies won't keep track much much longer... (i.e. insurance companies, banks, who knows?)

Same goes for the house. In this economy -- the last thing the bank wants is another house. They don't want to take a $200k loss on the books like that. Talk to your banker and explain the situation and see if there is a way you can stay in your house and restructure the loan. Get 5 roommates to cover the mortgage if you have to, but don't be so quick to just give up and walk away from the place.

You're lucky that you've made the mistakes early enough in life to where you have time to recover.

Cheers,

- Hakrjak
 

G_Alexander

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No one deserves a free ride, even if they have fallen on hard times. Where there is a will, there is always a way. This young man can heed our advice and change his attitude, and I am sure things will turn out for the better.

PS. For the record...I don't remember the last time intellectuality was measured by how many languages you speak, nonetheless, I speak Russian, English, Spanish, and a little Ukranian ;)

PPS. Thank you newlife...for coming back into the thread and speaking up when many others would just leave the community. It shows good character. And it is never fun to admit you were wrong. :cheers:

-Alex
 
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NoMoneyDown

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I assume that you're talking about the $385k mortgage with a $40k/yr salary? That happened a lot. No document loans, baby! Back then I probably could have sold my house to my dog if I tried hard enough.

So, I can assume this was fraud on one or both party's? If not, how can anyone in their right mind (I'm talking the lender here) give such a huge loan with such little income (and credit)?

The second question falls on the face of many homeowners out there (and not just the OP) in that how could they possibly afford such a note knowing they don't have the income to support it? I mean even at a 5% interest rate the payment would be almost two-thirds of their gross income.
 
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hakrjak

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So, I can assume this was fraud on one or both party's? If not, how can anyone in their right mind (I'm talking the lender here) give such a huge loan with such little income (and credit)?

The second question falls on the face of many homeowners out there (and not just the OP) in that how could they possibly afford such a note knowing they don't have the income to support it? I mean even at a 5% interest rate the payment would be almost two-thirds of their gross income.

If I had to guess (And maybe he can confirm or deny) -- the lender probably put him into a teaser rate for 6 mo's or a year, and did a stated income loan -- stating him at around $100k of income.... Maybe without even asking him.

I never even knew what my lender was doing the last few years when we would go stated. After about 4 deals I asked him if he wanted to know what my income was, and he just chuckled and said he just puts $100k for most people, because it makes the loans go through.

Cheers,

- Hakrjak
 

NoMoneyDown

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If I had to guess (And maybe he can confirm or deny) -- the lender probably put him into a teaser rate for 6 mo's or a year, and did a stated income loan -- stating him at around $100k of income.... Maybe without even asking him.

I never even knew what my lender was doing the last few years when we would go stated. After about 4 deals I asked him if he wanted to know what my income was, and he just chuckled and said he just puts $100k for most people, because it makes the loans go through.

Cheers,

- Hakrjak

Ugh. I can see the digression much clearly now.
 

8 SNAKE

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So, I can assume this was fraud on one or both party's? If not, how can anyone in their right mind (I'm talking the lender here) give such a huge loan with such little income (and credit)?

I'm no expert, but it seems that they used Clinton's famous "don't ask, don't tell" method of doing business. Lenders didn't ask how a buyer could afford the mortgage, and the borrower didn't tell the lender that he/she couldn't.

The second question falls on the face of many homeowners out there (and not just the OP) in that how could they possibly afford such a note knowing they don't have the income to support it? I mean even at a 5% interest rate the payment would be almost two-thirds of their gross income.

Same deal here...I'm guessing. A lot of these homeowners saw their houses as ATM machines. They knew that they couldn't afford the current mortgage, but they just had to hang on for the duration of the interest-only teaser rate (like hakrjack mentioned), until the property value shot up another 25%. Then they'd refinance and pull a bunch of cash out or sell the house for a tidy profit.

It worked for a lot of people...for a while.
 
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Banthaman

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Newlife, I can understand the spelling as it's my native language and I suck at it! That being said, a couple things that might help.

1. Use a browser like Firefox as it comes with an auto spell checker to give you a heads up.

2. When in doubt a thesaurus is your best friend. Six years of competition poetry don't lie. It also improves vocabulary making you more fluent in this country's native language as well as giving you more and possibly better opportunities otherwise.

3. Always re-read. English tends to be backward to the world and illogical at best but if it doesn't sound right to you it wouldn't sound right to a second party. You may think of a better way of presenting your thought in doing so too.

There is so much wisdom in the statements made in this thread it's amazing though even a bit harsh at times. One thought on this. Take the posts, good bad and otherwise in this thread print them out, and keep them in a very visible place. Return to them often and mark your progress. Come back to it in a year after seriously whole heartedly applying it. Re-read all the posts again. You will see and experience a change outward and in, I guarantee it.
 

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