I am in the process of filing chapter 7 bankruptcy and want

williams720 · Joined: 21 Jul 2008 Posts: 3 2.15 Dollars($)

I am in the process of filing chapter 7 bankruptcy and want to keep my home.

I will be 30 days late on my mortgage shortly after I file the chapter 7 simply because the bankruptcy costs so much. If I wait too much longer I may be opening myself up for law suits from creditors so time is of the essence. My lawyer is very vague and I am afraid to ask my mortgage company because they may not work with me if they know about the bankruptcy. Is it possible to keep your home after bankruptcy if you fall just a little behind? Wouldn't the bank rather have late payments than a home in this market? I could sell it but the realtor costs would eat up what is left of the equity since I would have to sell it cheap. Should I just let the house go in the bankruptcy and start over? Any advice would be helpful.

gmakerley · Posted: Mon Jul 21, 2008 8:48 am Post subject:

if you want to retain the home, you'll have to continue making payments during the bankruptcy - that means catching up as well as resuming payments and maintaining them.

if you have a lawyer who is "very vague" i would question how much expertise he or she has. are you sure you have a lawyer who knows the ins and outs of bankruptcy?

to answer your questions specifically: first, yes it is possible to keep a home after bankruptcy; second, you're right in thinking that lenders are not trying to obtain properties; third, letting the home go will have a major effect on your credit record, and starting over will take you quite some time.

if you're willing to start over at all, then selling it might not be such an awful idea after all.

williams720 · Joined: 21 Jul 2008 Posts: 3 2.15 Dollars($)

Should I call my mortgage company and talk to them or just wait until after the bankruptcy? We will be able to catch up the mortgage payments shortly after we file but I don't want to send in payments if they are just going to foreclose. My attorney's office filed the most bankruptcies in our state last year so I was lead to believe they know more than most. If we sell our house, how long will it be before we could purchase another home after our bankruptcy? Thank you for your assistance.

0.10 Dollars($)

not calling your mortgage company would be a bad move, whether or not you file for bankruptcy. you need to keep them in the loop at all times, regardless.

you're looking at a minimum 2 year wait post-bankruptcy for a purchase, unless guidelines change (and guidelines change awfully regularly).

gmakerley · Posted: Mon Jul 21, 2008 9:39 am Post subject:

not calling your mortgage company would be a bad move, whether or not you file for bankruptcy. you need to keep them in the loop at all times, regardless.

you're looking at a minimum 2 year wait post-bankruptcy for a purchase, unless guidelines change (and guidelines change awfully regularly).

this post was me....i got logged off automatically, i guess.

sweeney · Joined: 20 Jul 2008 Posts: 103 21.61 Dollars($)

"not calling your mortgage company would be a bad move, whether or not you file for bankruptcy. you need to keep them in the loop at all times, regardless"

I agree with George. They might even be able to cut you some slack.

williams720 · Joined: 21 Jul 2008 Posts: 3 2.15 Dollars($)

Which is worse: losing your house in bankruptcy or losing your house to foreclosure? When I say which is worse I am referring to my credit.

sweeney · Joined: 20 Jul 2008 Posts: 103 21.61 Dollars($)

Well, they're really two seperate events. Often the two are intertwined. The house isn't loss in a bk, that what the foreclosure is for. If you're filing chap 7, you want to start over with a fresh slate, so you don't want any late payments or foreclosures after the chap 7 is discharged. Get everything taken care of before the discharge, then be squeeky clean after. Late payments or a foreclosure after can makes it very very difficult on your credit or applying for future loans.

Hang in there, everything always works out ok in the end.

gmakerley · Posted: Mon Jul 21, 2008 12:13 pm Post subject:

and now i have to flip over and agree with mike here. bankruptcy does not cause anyone to lose a home. what it will do is delay foreclosure proceedings, which is often for the better as it allows a person (family) to acquire funds needed to bring the mortgage to a current status.

but as mike pointed out, if you're declaring bankruptcy you'll need to maintain an excellent payment record afterwards or else you'll suffer later.

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