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foreclosure and bankruptcy

Old 12-12-2007, 05:30 PM
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foreclosure and bankruptcy

I have some decisions to make and Im weighing things out, but I ahve lots of questions. Its sorta funny because for work Ive handled all the paperwork regarding these things, but besides the paper shuffling I know very little. SO Im asking for insight from any who have gone through this stuff.

My old home is vacant, has been a while. The market everywhere is shot, and particularly here in this area. There have been no bites on paper ads and signs for the house (which needs some work) at $69,000. Not even any lookers. A realtor is meeting me there on Friday but doesnt think selling it for that price, or in that range should be a problem. (Is it there job to say that?)

Im making payments and have fallen behind. I got the intent to accelerate letter , I can fix it by the deadline (Jan 3), but Im trying to decide if I want to. Insurance is due Dec 26, I am not planning on paying it, I cant get in any deeper. I owe $47,000.

I only want to sell it to walk away. What happens if I sign it over to the bank? How does that appear differently than a foreclosure? Does it?
Now if I choose to do that, I may choose also to file bankruptcy. I know complete charge offs are harder to get, but I think I qualify if the house is gone. Does that wipe a foreclosure off your record?

How does rebuilding work?

Any insight would be helpful, because if I choose to proceed with selling now and rememdy the deliquencies, I could be looking at this same issue when I reevaluate in 6 months
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Old 12-12-2007, 06:14 PM
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aaahhh jeeze.. I know how stressful it all is Cinders...I went thru this myself with our marital home.

My exah and I did file for bankruptcy before the laws changed. We discharged all of our debt but we re-affirmed the house because my exah was absolutely sure that he was 'done' using drugs and we thought we would be able to save our home.

Of course, my exah wasn't as 'done' as he thought he was and we ended up falling behind on the house. When I left my exah, I also left our marital home behind. Although I struggled to keep up with the hefty mortgage payment on my own (on top of paying rent at my new place), I was falling deeper and deeper into the muck. Finally, I just decided that I was throwing good money after bad and I contacted our lender. They agreed to take the deed in lieu of foreclosure. We basically walked away from the house with nothing to show for it but the debt was included in our bankruptcy estate from the year prior and so we weren't any worse off credit-wise when we did this. I'm told that we were very lucky that the mortgage lender reported the deed in lieu as being included in the bankruptcy discharge (rather than as a foreclosure after the fact). It took alot of phone calls and letters to the lender to accomplish this feat let me tell ya !!!

Anway, it was the smartest decision I ever made. I was actually able to buy my new home just 2 years later...with a decent interest rate. I thought it would take a lot longer to re-establish my credit. Its amazing how I can actually pay my bills on time now that I'm not carrying the dead weight of an addict around anymore.

Have you contacted your lender in order to discuss your options? I know bankruptcy and/or a deed in lieu of foreclosure are options of a last resort but in my case, they were the only way out.

Good luck with everything...
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Old 12-12-2007, 06:18 PM
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Originally Posted by cinderellawkids View Post
I have some decisions to make and Im weighing things out, but I ahve lots of questions. Its sorta funny because for work Ive handled all the paperwork regarding these things, but besides the paper shuffling I know very little. SO Im asking for insight from any who have gone through this stuff.

My old home is vacant, has been a while. The market everywhere is shot, and particularly here in this area. There have been no bites on paper ads and signs for the house (which needs some work) at $69,000. Not even any lookers. A realtor is meeting me there on Friday but doesnt think selling it for that price, or in that range should be a problem. (Is it there job to say that?)

Im making payments and have fallen behind. I got the intent to accelerate letter , I can fix it by the deadline (Jan 3), but Im trying to decide if I want to. Insurance is due Dec 26, I am not planning on paying it, I cant get in any deeper. I owe $47,000.

I only want to sell it to walk away. What happens if I sign it over to the bank? How does that appear differently than a foreclosure? Does it?
Now if I choose to do that, I may choose also to file bankruptcy. I know complete charge offs are harder to get, but I think I qualify if the house is gone. Does that wipe a foreclosure off your record?

How does rebuilding work?

Any insight would be helpful, because if I choose to proceed with selling now and rememdy the deliquencies, I could be looking at this same issue when I reevaluate in 6 months
Go to prayer and meditation and ask God to direct your thinking. Keep doing this until you get an intuitive thought. Then, listen to your intuition. Good luck.
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Old 12-12-2007, 06:23 PM
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Do you know how deed in lieu of foreclosure looks credit wise? That apparently is an option.

I should be able to get a charge off bankruptcy in that I have no assets (once house is gone) and my income only covers bare essentials of raising 3 kids (no child support, oldest childrens' dad serving a life sentence) and I have just under $5000 in charged off credit debts -(which I had hoped sale of house would wipe out.)
I just want to start fresh and start moving forward.
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Old 12-12-2007, 06:23 PM
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sounds like good advice to me from both your answers.
I keep saying we've got smart people on here!!!
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Old 12-12-2007, 06:39 PM
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Just a thought about the charge-offs. I have several from credit cards and I thought once they were charged off, I didn't have to worry about them. Turns out, a collection agency sued me (when I was still in active addiction) and won. I found out when the police showed up at my door with papers ordering me to respond (NOT a good feeling when you've been on the wrong side of the law).

I was able to make a payment plan with them, but still had to get a lawyer to know how to respond to the court (I used prepaid legal...about $30/month). This is probably due to the fact that this one debt was $4000. When another charge-off was sent to a collection agency, I went ahead and made a payment plan with them, too, because I was afraid they would sue me too. The lawyer handling it told me "just because it's charged off, does not mean you're not still responsible for the debt" - I honestly thought it did.

I hope you can get things worked out. I'll be paying off stuff 'til I'm 90....maybe then I can afford a decent nursing home

Hugs and prayers!

Amy
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Old 12-12-2007, 06:45 PM
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Originally Posted by Impurrfect View Post
Just a thought about the charge-offs. I have several from credit cards and I thought once they were charged off, I didn't have to worry about them. Turns out, a collection agency sued me (when I was still in active addiction) and won. I found out when the police showed up at my door with papers ordering me to respond (NOT a good feeling when you've been on the wrong side of the law).

I was able to make a payment plan with them, but still had to get a lawyer to know how to respond to the court (I used prepaid legal...about $30/month). This is probably due to the fact that this one debt was $4000. When another charge-off was sent to a collection agency, I went ahead and made a payment plan with them, too, because I was afraid they would sue me too. The lawyer handling it told me "just because it's charged off, does not mean you're not still responsible for the debt" - I honestly thought it did.

I hope you can get things worked out. I'll be paying off stuff 'til I'm 90....maybe then I can afford a decent nursing home

Hugs and prayers!

Amy
Yes we are in the process of that as well. I told them to sue me and get a judgment against me, and I told them to do it quick so they could still put a lien on the house. (theyve refused payments Ive offered)

I was hoping the house would sell to clear up all this debt from being with an active addict, cause God knows they have no intentions of suing him.

For today Ill just make no decisions until after the realtor does the walk through
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Old 12-12-2007, 07:03 PM
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Originally Posted by cinderellawkids View Post
Yes we are in the process of that as well. I told them to sue me and get a judgment against me, and I told them to do it quick so they could still put a lien on the house. (theyve refused payments Ive offered)

I was hoping the house would sell to clear up all this debt from being with an active addict, cause God knows they have no intentions of suing him.

For today Ill just make no decisions until after the realtor does the walk through
Yeah, in this case that would be better for you. Kinda wierd - I get sued (when I didn't want to) and you can't get sued fast enough..why can't these people cooperate

I was just told that if I didn't work out an agreement with them, they could garnish my wages up to 25% of each check. It wouldn't be much, since I'm a waitress and depend on tips, but was also told they would get my entire income tax refund and THAT I don't want.

I'll keep my fingers crossed for you!

Hugs and prayers!

Amy
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Old 12-12-2007, 07:08 PM
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Guys,

I apologize for posting in this forum. It didn't occur to me that this is for friends and family. Best wishes to all.
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Old 12-12-2007, 07:08 PM
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Yeah, in Florida they cant garnish head of household or if you make $500 a week or less.

Thanks everyone for the advice
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Old 12-12-2007, 07:10 PM
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Wow Impurrfect. I found a few charge offs on my report, but they actually belong to my xah. Somehow my name is an authorized user on all the cards he didn't pay! lucky me. I got a few off my report, but there is one charge off that scares the pants off me. These debts of his were in the 30 thousand dollar range.
He agreed to "be responsible" for it in divorce papers, but that doesnt' mean they still can't come after me.
He hasn't worked in years. His mother takes care of his every need! Talk about enabling.
Shoot, now I am getting all scared. I guess I need to talk to a lawyer myself.
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Old 12-12-2007, 07:13 PM
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Wascally if your not getting calls from collection agencies I wouldnt worry about it, and in I thought if the divorce papers says he 's responsible it can be on your credit report but they dont come after you for it

Ok my morgage lender does deed in lieu of foreclosure and agreed sale in lieu of foreclosure. But what do those mean?

What happens if they auction house and get less than owed, cause we know whats happening at auctions right now.

Doesnt someone want a nice Florida home for $50,000? LOL
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Old 12-12-2007, 07:23 PM
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Wascally -

I think Cindi's right - if he claimed responsiblity in the divorce papers, they can't come after you. I didn't get the prepaid legal service until the day the cop showed up at my door, and they told me what to do right away, so I wouldn't worry about getting a lawyer right now. I still have about 10 other smaller debts that are charged off and they haven't done anything so don't worry about something that probably won't happen.

Funny thing is, the collection agency that sued me sent me a letter that basically said that they had looked at my credit report and decided that I could settle for a lump sum of $2500. I told them that if they looked at my credit report, what they saw was that I owed a lot of people a lot of money!

Cindi - glad to hear about the head of household. The only way I could claim that is if I counted the 4 cats as my kids (think it would work?)
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Old 12-12-2007, 07:28 PM
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Chase Bank Card is one known for pursuing any means to get there money. They are the only collection one that worries me and I got the same letter they will settle for $1200
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Old 12-12-2007, 07:39 PM
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don't know about you, but that might as well be $12,000 to me....so far I've got just enough to pay my current bills.
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Old 12-12-2007, 08:04 PM
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I don't know a thing about this, cinder, but I am sending you hugs and prayers. Love ya!

((((HUGS))))
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Old 12-13-2007, 09:04 AM
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I have not been a bank loan officer in almost 20 yrs. Laws are different now.

I would talk to an attorney first. Do they not do free consultations in Fl.?

You would be suprised at what a good RE broker can do-I would think a tent in Fl. would be worth $$$$...People are always looking for "fixer- uppers". Where are you in Fl.-I have friends there.(PM if you want)

Bills, we could trade-hehe. Hospital over $150,000 and the list goes on. Here, if you don't have it - they don't get it. If I had it they would get paid.

Some charge cards sell your acct. to a creditor-they try to collect-then sell it to another and on and on.

I finally took the phone #s off the caller ID and registered them with The Do Not Call registry. No calls anymore!
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Old 12-13-2007, 12:22 PM
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here is an article about deeds in lieu of foreclosure. it isnt different (credit report wise) than a foreclosure..it looks the same on a credit report and to future lenders as if you did foreclose.

http://www.homesalerelief.com/blog/d...-work-for-you/

my husband, before we were married, had a deed in lieu of foreclosure and when we bought our house there were no issues about it at all. the lender did ask us why he didnt just do a foreclosure, though.

good luck with everything!!
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Old 12-13-2007, 01:15 PM
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I read through that and found it interesting that both foreclosure and bankruptcy stay on your credit report so bankruptcy doesnt wipe out the foreclosure, and foreclosure looks better than bankruptcy-which kinda surprises me
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Old 12-13-2007, 05:30 PM
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yeah, its weird how all that works..but really, in the end, the lender - be it house, car, credit card, whatever - has the final say and will see either one as not so good. luckily, though, bankruptcy doesnt affect you for too long. mine was discharged in may and i already am on the loan with my husband for our house, have a car, and also have a gas credit card.

anyway, good luck!
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