Can we bankrupt an equity loan w/o losing our house. Both are by the same bank..Wells Fargo.?

Deal Score0

Wife and I took out a 50g equity loan over 4.5 yrs ago. At the time we both worked for a big company. We never thought we would both lose these jobs less than a year apart.( My wife stressed out of her 21yr old job and later developed fibromyalgia after nearly dying from bleeding ulcers.) .We had taken in 5 grandchildren almost 3 yrs earlier and of course things were difficult and her job was not supportive..anyway my point here is that over time the money was gone and neither of us found jobs anywhere near what we made before. We squeak by but whats killing us is that equity loan..we cant afford it, because we owe it still after 4 years the interest went sky high. We paid monthly but now after 4.5 years we actually owe more than what we borrowed ( 64g)! .
We realize at our age, we will be dead before we can pay it, we still have 4 of the grand-kids to support, we can make our mortgage but the equity loan jumped up nearly the same as the mortgage. We feel our only way out is to bankrupt it. We are hearing terrible stories of people that got home loan modifications and were worse off! We feel so bad about the position are in. We don’t even want to talk to the bank cause we don’t trust them. I recently completed courses to update my abilities in AutoCAD, SolidWorks and MasterCAM but still haven’t found a job. Since I lost the one really good job, I have worked in a few smaller, family oriented businesses that ended up closed. I went back to school on a scholarship. Currently my income is EDD,trust me, we pray daily for a decent job along with sending out resumes etc. It’s not so easy when your considered older than most of the work force. My wife works for the school district part time when school is in session. We have no health insurance but with this money problem it’s the least of our worries as this problem keeps us up at night. We can’t sell our house, we would get nothing because with what we owe on it and the equity is about what the value of our small home has gone down to. Also, a apartment or house would be more than our mortgage is and we will have these kids till they all turn 18. They are 10-17yrs old now)
If your wondering, we do get state aide for the children approx 160.00 each. If not for that, we could not feed and care for them and they would all end up in foster homes…which is why we took them all in in the first place, to keep them together. This is basically all of it. Any advice, any prayers appreciated.
We haven’t had TV for over 7 years, just dvd’s. The oldest works part time & in school still. The house is 2 bedrooms so we can’t go smaller.We all have given up luxuries My wife still has physcial/medical problems and can only work part time. She is spending the summer doing our yard sales. Renting an apt would for sure be more than our mortgage.

  1. Reply
    April 29, 2011 at 11:57 pm

    Many prayers coming your way. My only thought (unprofessional opinion) on this: if your home is listed as collateral on that equity loan I don’t see how you could keep from losing it, but like I said I am not a professional and will be curious to see what answers you get from people who are more experiences in this realm.

  2. Reply
    April 30, 2011 at 12:48 am

    I don’t think you can default on your loan without losing your house.
    Talk to your bank before it’s too late and see if you can work out a new restructuring plan. You may be surprised at how flexible they are.
    Banks don’t want to repossess houses. They aren’t in the real estate business and it’s a lot of of trouble for them to deal with home sales.
    They’d rather work out a solution that benefits you and them.

    I don’t know what you used your equity for, but for others that are reading this, DON’T use your home equity to pay off credit card debt!
    If you default on a credit card, you can ruin your credit, but you can’t lose your home.
    If you default on an equity loan, you can ruin your credit and lose your home.

  3. Reply
    April 30, 2011 at 1:26 am

    Sorry to hear you are in trouble. We are in the same boat. Not sure what state you live in but maybe some of the age working grandkids need to get a part time somewhere to help you out. I am not sure what you did with that 50G’s but hopefully you have some of it left. Also, an apartment would be your best bet right now. You’d cut utilites, water, sewage, the kids can share a room. When times are tough they need to understand that sacrifices need to be made. They are old enough to undertand this. We are in th same boat. We wouldn’t get much either for our home and our equity is nothing even though we been here 7 yrs! We have a daughter. We are considering selling our home and moving in with my mom. She has a spare bedroom for the three of us and her mortgage is half of ours. Your wife needs to find a job during the summer! This family needs to get it together and stop thinking about what you are loosing. If you don’t trust your bank, stop banking with them. We been 4 months behind and our mortgage company put us on a foreberance plan for a year. We can’t even afford that, So we will probably have to give up the house and move to mom’s. Even if its just for alittle while. The kids will be fine. Just make the sacrifice now! Before its toolate. Good luck. God bless.

    Leave a reply

    Register New Account
    Reset Password