Posted on: 24th Feb, 2009 03:10 pm
i owe IRS back taxes since all my income has gone to making mortgatge payments in the neighborhood of over 400k per year. my accountant thinks i should file ch 11. what advantage do i have to short sale property as opposed to just filing ch 11. what is the outcome on my credit?
thank you
thank you
hi ericcraigarizona,
chapter 11 is filed by businesses including llc, corporations and sole proprietorship which helps the business organization to reorganize its finances and debts. the business organization gets a repayment plan approved by the trustee and creditors. however, individuals may also file chapter 11. you will have to pay off the debts according to the new plan within 3-5 years of filing bankruptcy. generally, filing bankruptcy reduces your credit score by 200-250 points.
on the other hand, if you want to short sale the property, you will have to contact the lender. if the lender is convinced by your hardship, he may be ready to go for a short sale. you should note that you will be liable to pay the deficient amount from the sale of the property to the lender. your credit score will be lowered by 75-100 points.
thanks
chapter 11 is filed by businesses including llc, corporations and sole proprietorship which helps the business organization to reorganize its finances and debts. the business organization gets a repayment plan approved by the trustee and creditors. however, individuals may also file chapter 11. you will have to pay off the debts according to the new plan within 3-5 years of filing bankruptcy. generally, filing bankruptcy reduces your credit score by 200-250 points.
on the other hand, if you want to short sale the property, you will have to contact the lender. if the lender is convinced by your hardship, he may be ready to go for a short sale. you should note that you will be liable to pay the deficient amount from the sale of the property to the lender. your credit score will be lowered by 75-100 points.
thanks