I speak to many people in your type of situation. Right off the bat - I am not licensed in the state of California, so I could not work with you. I do know a few attorneys that would help you, if needed.
As far as your credit is concerned - this is a last propriety
It is easy to turn ones credit around...... later. I used to fix peoples credit for free and till I got burned by taken advantage off.... Over the years have seen 1000's of credit reports, the ones that were above 780 no longer had a mortgage. Unless you have 75% of your obligations paid off, I seriously doubt your in the high seven hundreds, especially with hard credit pulls and the balances on your credit cards.... Again your credit is off the table.
See link explaining the different lateness's - Late Payment Secrets Revealed! | Credit.com
- 30 days late – This record will damage your credit scores only when it is reported as “currently 30 days late.” The exception is if you are 30 days late often. Otherwise, a 30-day late payment will not cause lasting damage.
- 60 days late – This record will also damage your credit scores when it is reported as “currently 60 days late.” Again, the exception is if you are 60 days late often. Otherwise, it will not cause long term damage.
- 90 days late – This record will damage your credit scores significantly for up to 7 years. It doesn’t make a difference whether or not your account is currently 90 days late. Remember, the goal of the scoring model is to predict whether or not you will pay 90 days late or later on any credit obligation. By showing that you have already done so means that you are more likely to do it again compared to someone who has never been 90 days late. As such, your credit scores will drop.
- 120+ days late – Late payment reporting beyond the initial 90 day missed payment does not cause additional credit score damage directly. However, there is an indirect impact to your scores. At this point, your debt is usually “charged off” or sold to a 3rd party collection agency. Both of these occurrences are reported on your credit files and will lower your credit scores further.
As for filing bankruptcy - right now forget about it. It is used as a last ditch effort to save the home. You have a few months before you want to consider it. Stay away from Bankruptcy attorneys - they will make it sound easy to do one. They have no concern for your future as far as your credit is concerned.
Yes you do need income for a chapter 13 bankruptcy, to make payments to a trustee. If you become late on a payment, it is easy for a debtor to file a "Relief of Stay" and get something removed from bankruptcy protection. Continued lates on a bankruptcy will result of an automatic discharge.
Since you are out of work -and unemployment hasn't kicked in. The possible delay is for 1099 workers, in many states there is unemployment compensation by it takes time to process. You need to get organized!
On a piece of paper write out all your obligations, amounts, dates due, etc... Then you are going to prioritize them into which one is most important. Your home is first priority
- because you are in a non judicial state, your Lender could foreclosure on your home after four months.
You are saying your home is worth $200k, and owe $100k - you are unlike most of the people in your state. Most national charts showing the amount of people owing more then what their property are worth, California is almost at the top of the list!!!
If in fact you do owe 50% less then what its valve is worth. If need to do a short sale. A Short Sale - this does the least amount of damage to your credit score. Upfront when stating the negotiations you want to negotiate they can not do a future Deficiency Judgment against you.. Some Realtor's here might say your state it is non practical for them to do a D/J since they get the property back. Ultimately it depends on what you signed on your loan note when you did your closing. If you think your house will sell within 90 days - that is the way to go.
The bad news - if you have no income coming in, you going to have to let the property go because you can't afford it. The problem with a Short Shorts - most do not sell in the 90 day time frame, so the Lender can continue with the foreclosure process. Knowing you do have equity, I seriously doubt they will settle for less on what you owe them. Any reduction will have to come out of your equity.
Very important to understand - what you don't say cannot hurt you!!! Do not mention to anyone
- especially your mortgage company, you have any money in savings or your 401K. They will go after it!
As for your credit cards - it is your right to settle those amount at a lower settlement. That $25,000 credit card could easily be settle for $8700 - by yourself!!! You should not got involved with any type of debt resolution company. You will be spammed out of your money.
Your question about sending in a $100, forget able that, it's either your full payment, arrears, on an agree modified payment. Have you go late after 90 days - most banks freeze the current loan, and set up a suspense account. Any and all new obligations go into this new account.
Last week I read a report from the Presidents office, confirming what I had all ready known. HAMP is failing and people are getting better deals working with Attorneys to save their homes.
Here is one problem with the banks - home owners are trusting their Lenders. The Lenders are putting inexperienced personal working on the front line to work with homeowners.
I can cite many cases and examples - last week I read that Chase is hiring college grads to work doing loan modifications. These kids are either renting or still living with mommy and daddy. Home owners dealing with people half the age - to save their home from foreclosure..... Ask them an easy question like... "How long do I have before paying principle on an interest only loan?
I bet half on them would answer wrong.... .
Lenders are hiring people with limited understand of a mortgage. Because of their lack of experience - like "robots" they are trained to qualify people for a HAMP modifications. Out of the millions of people that applied for HAMP mod, as of September 2010 only 468,000 have been approved.
Here is the reason main reason why it takes so loan for a modification to be approved, without evening analyzing the loan, the new bank employees submit for a HAMP modification away. Months later it gets rejected for either being late on the mortgage, or greater then 125% LTV, etc. If the situation was analyzed by somebody who knew what they were doing. The homeowner would be able to work on another program. It doesn't take a Rocket engineer, or spending millions of dollars for research it understand this.....
Ultimately Fanny and Freddy were to cause of the mortgage meltdown across America. Fannie Mae and Freddy made CMO's available to buy on the secondary market, it is now to the point they have been brought and sold so many times. Fannie and Freddy are left with worthless CMO's, by 2012 and by 2015 mortgage pools should transferred into MBB pools. People's homes should not be traded and gambled.
Sorry I went a little Over Board - answering you questions. I am working on my Theseus - Doing away with Freddy Mac and Fannie Mannie by the year 2015
Can I offer to close my credit cards an pay less than hafe of what I owe. Or do I have to miss of be late 1st I have never been late an it is hard to do after 20 plus years.