I've mentioned my impending bankruptcy. I've had my house on the market since May with nary an offer. I've had open houses, it's been online and in the paper - it's just not selling.
I live in an apartment in the city where I work now I am not making house payments but I still pay the utilities and insurance. The insurance is $300 a month because the rates are higher since no one lives there. Overall, I am spending over $400 a month to keep this house on the market.
My kids and I are living paycheck to paycheck, quite literally barely keeping our heads above the water.
My question is this: do I keep paying for the house expenses or just call the bank and say, "Take it!"
If it sells, I'll still be financially busted but I won't be going bankrupt for quite as much money. It would pay of two of the biggest debts, leaving me only $70K in debt, instead of $170K. I don't know that I could pay off the $70K any more easily than the $170 but I might be able to come up with some way to make small payments through one of those credit counseling places.
Either way, my credit is completely shot. I'm not really concerned with that. I just feel guilty and dishonest by filing for bankruptcy. It feels like I stole that money, even though I had every intention of paying it back at the time.
SO if you walked away from the house, you'd save over $700 a month that you could use somewhere else? Give it back.
If you filed for bankruptcy, you can't sell any assets down here.. probably the same up there.
If you're going bankrupt, I don't see that a credit council service will help. The court will take care of how your debt will be discharged.
As far as feeling guilty, unless you went into debt with the intention of NOT repaying it, you fell into the same game most of the rest of us did...the banks/credit card companies gambling that you will repay, so they keep offering more cards and higher limits. You take them up on it because "they wouldn't give it to you unless they thought you could handle it".
I don't know about the laws in Canada, but the banks down here don't give a damned about their CC customers...if they did, they wouldn't have double the interest rates last year.
I have a 1st, 2nd, and 3rd mortgage on the house. The 3rd is my business loan. In order, I owe $88K, $11K, and $36K. The house is listed for $119K - so even if it sells, I'll still have that debt - there is additionally about $40K of debt not attached to the house.
If you can swing it..i would continue to make the payments until it sells
I think foreclosure or bankruptcy is for when you absolutely cannot pay it...it is when you have to choose between putting food onthe table for your kids or other essential items that you cannot live without....other than that...I think someone should pay their bills...i don't know your situation so i can't give you an answer...Good luck with whatever you choose to do.
You owe $135K on it and it is listed for $119K? Does your realtor know that there are 3 mortgages? If you don't have the money to pay the difference plus your closing costs, you can't sell the house.
Have you spoken to the bank? How long since you stopped making payments? It might be in foreclosure already.
We have a legal waiver from the 3rd mortgage-holder that allows us to sell, even if it doesn't cover their mortgage. It was drawn up by an attorney and signed by both parties.
I haven't spoken to the bank recently but wouldn't I have received something from them if it was in foreclosure? They have been in contact with my realtor to make certain we are still trying to sell. I stopped making payments in August.
I just want it gone, at this point. I'm so tired of this mess I've made. :sigh:
Okay, so if they are going to release the lien on the 3rd mortgage then you need to get $99k plus commission and legal fees. You should be able to drop your price about 10k and still break even. The bank is going to take it within a few months anyway, I would go down to $109k in a last-ditch effort to sell. If it won't move at 109 let them foreclose.
I do not think it is inappropriate that you feel bad about filing for bankruptcy. Too often I hear of those who just lightly brush it aside as"A nice, fresh start", or who blame their creditors .You have a conscience.Maybe you can file for a reorganization of your debts, which will allow you to repay them, but within a budget you can afford.That would be different than just walking away from the mess.
A quote that we use often at work is "Hope isn't a strategy".... I don't know the ins and outs of bankruptcy or foreclosure but I'd most definitely be thinking of other alternatives.
I guess this point is moot now. I stopped by today to do my weekly check in on the house and it was deadbolted with new locks - I assume from the bank.
Even though I knew this would happen, I cried my eyes out. I know, pretty stupid - not like it was unexpected.
Thank you for all the advice, though.
And I agree, as well, that bankruptcy should be a last option - I haven't made these decisions lightly.
I would have thought you would have gotten a notice from the bank if it was foreclosed on...I think they would do this by the book....and you said you only stopped making payments in august....I would have thought it would have taken longer than 6 months for a foreclosure to go all the way through...however i am in no way an expert on these things, maybe someone else could clue me in that has gone through a foreclosure on the steps that are taken..I have recently been set up on a repayment plan that is enabling me to pay extra every month to catch it up...Thank Goodness but would like to know the steps that are taken and roughly how long it would take to happen...just in case i am in the same boat which in today's economy could be so... thanks for your help and i am so sorry you have to go through this... it must be mentallly exhausting...i know just trying to prevent foreclosure was mentally exhausting enough for me...
I wish I knew more answers to tell you, alotofgooddeals. I'm not sure where you are, but I am in Canada, so the laws may be slightly different here than where you reside.
Good luck getting caught up on your mortgage. I hope it all works out for you.
Daisygirl,
I am so sorry to hear about your situation. I have a house that I hate but I know I will be in the same situation if I try to sell it. I definitely owe more than it is worth and nothing is selling in Atlanta right now.
I know how upsetting it must have been to find the locks changed- the reality of it must have been overwhelming.
Hugs to you.
So sorry, I think you need to stop beating yourself up about it. You did try to sell it..it stinks, but so many people I have read about, just walk away, leave the utilities to be turned off for non payment, let the food rot..i have heard horror stories. I think you did what was in your power, and now it is done. Move on and hold your head up..it has happened to many.
jettylady
I just replied to your other thread...please go back and read the 2 posts there...I don't know about bankruptcy laws in Canada but please read the other thread...In canada do they do 1099c? C standing for cancellation of debt...
File the house in the bankruptcy...don't sell, don't give it back...FILE THE HOUSE....Otherwise it will come back and bite you in the butt...Filed you are out of it...sell it or give it back and you could end up either owing the difference or a bunch of money that you don't have...if you had it you wouldn't be filing.
Read my other 2 posts other thread...we filed April 27th and still fighting collectors...
If it sells, I'll still be financially busted but I won't be going bankrupt for quite as much money. It would pay of two of the biggest debts, leaving me only $70K in debt, instead of $170K. I don't know that I could pay off the $70K any more easily than the $170 but I might be able to come up with some way to make small payments through one of those credit counseling places.
Either way, my credit is completely shot. I'm not really concerned with that. I just feel guilty and dishonest by filing for bankruptcy. It feels like I stole that money, even though I had every intention of paying it back at the time.
In the US you can't have had dealings with credit counciling within 6 months previous to filing...
so that means you file...leave out of the bankruptcy a HUGE chunk of debt and after filing you deal with the counciling who THEN in return deal with the credit card or whoever companies who already know that you filed and can't file again for 7 years...so if you can't file for 7 years again why would they want to deal with you...they HAVE you...they in turn come after you at that point and there isn't any thing you can do about it...you can't file again...they can and will put liens and/or judgements against you anytime you aquire anything..
Credit? you credit is already shot...why worry.
If you are filing then file all of it...what you don't file will bite you in the butt also...believe me. They don't care about you...don't worry about them at this point...worry about yourself and the kids.
Wish I had taken this advice 2 years ago that I'm giving you now. File any/all/everything...don't have a heart where they are concerned...and don't feel guilty...they didn't feel guilty when they took your money or our money...whoever's money for bailouts while they still made million dollar bonuses....
Get tough...get armed with information...don't ASSUME anything...ask and then ask again...then when that's done dig on the computer.
Assumption is the mother of all...well, it is...never assume ANYTHING and READ EVERYTHING TWICE BEFORE YOU SIGN IT
Typically a bankruptcy only includes unsecured debt, meaning you could still owe for the mortgages after bankruptcy. If the house is foreclosed the sale proceeds will go towards the mortgages and you will still owe the difference.
Have you spoken to a bankruptcy trustee? You really need to make sure you have discussed this with an expert before deciding what course to take. Your house is not foreclosed yet, you would have gone to court for that. There may still be time to negotiate with the bank - they hate foreclosing, it's a big expensive hassle. A bankruptcy trustee may be able to help negotiate, as well as provide counsel about what your best options are.
Typically a bankruptcy only includes unsecured debt, meaning you could still owe for the mortgages after bankruptcy. If the house is foreclosed the sale proceeds will go towards the mortgages and you will still owe the difference.
I don't know about in Canada..only in US...we filed on 2 houses...houses and secured can be filed on. Houses they get back and you will not owe on them if filed. We filed a 13 to do a payback however we do not pay back anything on the houses. We let them go. We are totally out from under them.
Secured can be filed...You payback on a 13 if you want to keep it...if a 7, complete, is filed then nothing is paid back, but you do not keep..
In the US the trustee is kind of like the judge...they decide whether it flies or not...final say..the bankruptcy attorney would be the one to negotiate. The trustee is who you make the repayment to if a chapter 13.
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