What happens now that I have left the property?

ktskindear · Joined: 22 Apr 2008 Posts: 4 2.67 Dollars($)

My house is in foreclosure. The bank set a date to auction it so I moved out. They have now postponed the auction 4 times. I have a 2nd mortgage also. From what I've read in this forum because of the 2nd I can't do a deed in lieu. My bankruptcy attorney keeps saying don't do anything until the sheriff serves you. I'm so confused. What's going to happen next?

Guest 0.10 Dollars($)

Have you thought of filing bankruptcy? which type does your attorney suggest - ch 13 or ch 7 ? I guess ch 13 will be the right one but only if you qualify for it. Isn't your lender saying anything about alternative option which can help you avoid the foreclosure sale? It is true if the sheriff hasn't send you the sale notice there's still time left for you to decide upon a Bk without having to leave your home.

Caron · Posted: Wed Apr 23, 2008 5:04 am Post subject: RE: foreclosure acution

Hi ktskindear,

Welcome to our forums.

Is the date of the sale a few days ahead? If that is so, then you need to make it fast. What's your bk attorney advising you. I suggest that you try to go for chapter 13 filing if you qualify though. But I'd like to ask you, weren't you given options to avoid foreclosure sale? what went wrong there? Did you ask the lender for a deed-in-lieu (dil)? It's true he may not agree because of the second mortgage. Since you will be the one handling property through dil, therefore it's important as to what the second lender wants. Did you talk to him in this regard?

0.10 Dollars($)

Thanks for replying. I haven't talked to the second lender. They sold my loan to someone new. The auction is set for the 24th. We talked to the lender about stopping foreclosure but the only option they gave us was to pay 6ooo a month which we couldn't afford. I was going crazy not knowing when I'd be kicked out and if anyone would rent to me, so I moved. The house is vacant. My husband had to get a job in England and will be gone for 2 more weeks. We still have a few things left at the house. We're just trying to give the house back. I'm in a lease now so even if they said pay 3000 a month I couldn't now. The house is old and falling apart. No furnace, bad plumbing...I just want to move on. I don't understand the differance between DIL and foreclosure. I thought if you don't pay they take your house. It's been amazing to me how long they are taking. What exactly happens when it's forclosed? Then do I file bankruptcy? I know this all sounds strange, I'm just tired of not knowing. I'm also worried I shouldn't have moved but I couldn't stand not knowing when I'd get evicted. I personally think the bank was short sited. We have a job now and I don't think anyone is going to buy this property. So I guess my question is how do you give the house back?

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi ktskindear,

Now if the lender accepts DIL that means that you need not to pay anything to the lender even if the property sells in less than what you owe to the lender. But if the lender forecloses then you need the pay the due amount after selling the property and it will also have a huge negative effect on your credit report.

Now if you want the home then I think the best option for you is filing bankruptcy chapter 13. Check out this article to know how you can avoid foreclosure with chapter 13 at http://www.mortgagefit.com/bankruptcy/foreclosure-chapter13.html

Feel free to ask if you have any further questions.

Best of luck,
Larry

Guest 0.10 Dollars($)

I don't really want the house anymore. We've moved already. When I file for Chapter 13 does that forgive what I owe the lender?

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi ktskindear,

Welcome back.

Your due mortgage will not forgiven be even if you file chapter 13 but you can certainly avoid foreclosure. Also you will not be evicted from the house and with an affordable rate and term you can pay off the mortgage.

Best of luck,
Larry

Guest 0.10 Dollars($)

I've moved out and signed a lease. They didn't give me anything affordable. What is due mortgage? I guess I'll see where the chips fall. I thought if you couldn't pay they take your house. Everyone's advice is been save your house but I couldn't so I moved. How do I save it now? I just want to move on. Guess I'll have a huge debt that I can never pay. I thought that was what bankruptcy was for.

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi ktskindear,

In your other post you have said that you are will to go for deed in lieu as you cannot pay the deficiency. So if the lender accepts the DIL then it is good and you can move on your life. But it may have effect your your credit.......... that's all but the lender cannot collect the deficiency judgment.

After that I should suggest try and improve your credit Smile

Feel free to ask if you have any further questions.

Best of luck,
Larry

sara · Posted: Sat Apr 26, 2008 4:42 am Post subject: RE: dil and bk issues

Hi ktskindear,

"Due mortgage" would mean the part of the loan that is yet to be paid off. if you have filed bankruptcy and if it's chpater 13, then you need to make some payments as per the repayment plan approved by the trustee. But I doubt whether you've filed chapter 13. what type of bankruptcy is it? have you ever thought of offering your current home for rent and then using the rent payments to pay off your loans?

Take Care

Guest 0.10 Dollars($)

Hi, the house as it is, is unrentable. There is no furnace, horrible plumbing and most of the rooms are in the middle of being refurbished. (I had been scrapping off the cottage cheese ceilings and re plastering and painting) As we were unemployed, we ran out of money to improve the house. It's old and falling apart. I don't think anyone would rent it. We were willing to live there because we thought the equity would improve and it was a labor of love, slowly fixing up our dream house. As far as due mortgage we owe $700,000 on the house. We haven't filed for any bankruptcy yet because our bk lawyer said don't do anything until someone serves us. We finally talked to an real estate attorney and he said just try a deed in lieu and if that doesn't work hand them the keys and say so long. So that's what I'm going to do. Thanks for the answers.

Caron

Hi ktskindear,

As you've said the house is unrentable, I don't think it's in good condition. So, I doubt whether the lender would accept such a house because he in turn would have to invest a lost of cash and do the repair work so that he can sell the property and recover the money he owes.

Anyway, if your lender still accepts the deed-in-lieu, wherein you hand over the keys, your credit will surely get the hit. However, if you're not interested to keep the home, then this is the right way to go because here the lender probably won't ask you for the payment of deficiency judgment.

good luck

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