Credit hit after walking away

[braincramp]

We are getting close to closing on a cash deal for a new house. We were discharged in 2010 and did not reaffirm 1st or 2nd mortgage. My question is how bad is our credit going to get dinged when we just walk away and turn over the property to the bank ? I don't intend to need a great credit score because we pay cash for everything now or we don't get it, but I do trade cars every 2 or 3 years . Thanks for any insight !

[AngelinaCat]

Why trade cars every two or three years? With regular maintenance, today's cars can last for ten years or longer.

[LadyInTheRed]

A default on a discharged mortgage should not show up on your credit report.

If you are in an HOA, you are still on the hook for HOA fees and a default on those fees might be reported on your credit report.

ETA: It could take years for the bank to foreclose. You might want to consider renting the house out until it does.

[braincramp]

Why trade cars every two or three years? With regular maintenance, today's cars can last for ten years or longer.

I drive about 35,000 miles a year and being a ex-mechanic, I hate unreliable cars.

[braincramp]

A default on a discharged mortgage should not show up on your credit report.

If you are in an HOA, you are still on the hook for HOA fees and a default on those fees might be reported on your credit report.

ETA: It could take years for the bank to foreclose. You might want to consider renting the house out until it does.

Thanks, there are no fees and the problem renters around here is that there are very few that can afford the rent.

[AngelinaCat]

I drive about 35,000 miles a year and being a ex-mechanic, I hate unreliable cars.

DH and I work on our own cars (VW Jetta TDIs). We save a lot of money over what the same repair by VW would charge AND we appreciate the lack of monthly car payments.

[LadyInTheRed]

The advantage to not paying the mortgage is that you can rent for less than fair market value and still make a profit. You could do a deserving family a favor and make a little extra cash at the same time.


I had a truck with 120,000 miles on it. It was very reliable. The only reason I don't still have it is a that a lady hit it while it was parked and totalled it. We probably could have but another 120k miles on it and paid less in repairs and maintenance than buying a new vehicle.

[AngelinaCat]

I had a truck with 120,000 miles on it. It was very reliable. The only reason I don't still have it is a that a lady hit it while it was parked and totalled it. We probably could have but another 120k miles on it and paid less in repairs and maintenance than buying a new vehicle.

Indeed. 'Hub's car is 11 years old with 250K on it. He is aiming for 450K. We drive to Galveston twice a year, which puts at least 4k mileage on the car. Then there are trips to Tennessee to visit his brother now and again.

My car is younger at 9 years old with more than 155k on it.

[AngelinaCatHub]

I drive about 35,000 miles a year and being a ex-mechanic, I hate unreliable cars.

BC: Let me explain, 35K is nothing. A paid for car gets better gas millage. Mrs. stated that my 11 year Jetta has actually 265K on it. I am not a pro mechanic but have the ability to learn. To date, I have dropped transmission pan and replaced solenoids, twice. VW solution was change transmission. Not reasonable.

I replaced both trans-axles for the fact of CV joints. Not an easy job but I did it myself and I am not an auto mechanic. You do what you have to do and the Internet has the ways to do anything.

That being said, I only have one alternator, one serpentine belt three batteries, one belt tentioner, and the major cost of one timing belt that I will not do. the next timing belt is next January. I consider my car reliable, but if I had to, it owes me nothing as it has been paid for and has given me fine service. I would trust it tomorrow to take me across Country if need be. Your idea of changing cars yearly is vanity. Never lease, buy, and pay off and fix things you can. One car payment you make equals many repairs you would make when needed. Bank that and drive the wheels off of that buggy. It will save you much money. It is the practical thing to do. http://putnam-fl-cemeteries.org/N92/Untitled_1.htm


Hub

[braincramp]

BC: Let me explain, 35K is nothing. A paid for car gets better gas millage. Mrs. stated that my 11 year Jetta has actually 265K on it. I am not a pro mechanic but have the ability to learn. To date, I have dropped transmission pan and replaced solenoids, twice. VW solution was change transmission. Not reasonable.

I replaced both trans-axles for the fact of CV joints. Not an easy job but I did it myself and I am not an auto mechanic. You do what you have to do and the Internet has the ways to do anything.

That being said, I only have one alternator, one serpentine belt three batteries, one belt tentioner, and the major cost of one timing belt that I will not do. the next timing belt is next January. I consider my car reliable, but if I had to, it owes me nothing as it has been paid for and has given me fine service. I would trust it tomorrow to take me across Country if need be. Your idea of changing cars yearly is vanity. Never lease, buy, and pay off and fix things you can. One car payment you make equals many repairs you would make when needed. Bank that and drive the wheels off of that buggy. It will save you much money. It is the practical thing to do. http://putnam-fl-cemeteries.org/N92/Untitled_1.htm


Hub

I understand it's stupid but I have no other payments and I'm a car nut who tires of the same vehicle quickly. I don't spend money on other toys and I've taken 2 10 day vacations in my 62 years on the planet. Staying in a newer vehicle is the one vice I've still got.

[LadyInTheRed]

the Internet has the ways to do anything.

That's for sure! I have saved hundreds of dollars on appliance repairs by fixing my oven, refrigerator and clothes dryer using information I found on the internet and parts I bought on internet sites that allow you a year to return a part. After doing some research, you can buy the part you think needs replaced knowing that you can return the part if you were wrong.

[gpolly123]

That's for sure! I have saved hundreds of dollars on appliance repairs by fixing my oven, refrigerator and clothes dryer using information I found on the internet and parts I bought on internet sites that allow you a year to return a part. After doing some research, you can buy the part you think needs replaced knowing that you can return the part if you were wrong.

During the past 3 years of our Chapter 13, I have also researched online and repaired our refrigerator, oven and numerous repairs to our van. I currently drive a 1996 Plymouth Voyager that currently has around 240K miles on it. As soon as Chapter 13 closes we plan on replacing it as my husband no longer wants to drive it out of town as things are slowing going out on it again. We will probably buy another van and this time used.

[AngelinaCat]

I understand it's stupid but I have no other payments and I'm a car nut who tires of the same vehicle quickly. I don't spend money on other toys and I've taken 2 10 day vacations in my 62 years on the planet. Staying in a newer vehicle is the one vice I've still got.

Well, um, I don't mean to be impolite, but if you can afford to do that, why are you in bankruptcy?

[AngelinaCat]

Now having said that, I must confess that I do save up every year to go visit my Tall Ship ELISSA, in Galveston TX. In the Fall, I help make crafts for 'Dickens on the Strand', a major fund-raising festival for the Galveston Historical Foundation, of which the Texas Seaport Museum is part.

If I get enough volunteer hours in the Fall, then I am invited to sail in the Spring. This has been my lifelong dream: to help crew and sail an authentic square-rigged sailing ship. I have been privileged enough to be able to do so for 17 years. (And going out to Texas in 1996, enabled me to get my back, which was broken and didn't know it, fixed!!!)

Others would say that this is a foolish waste of money, so BC, I understand the passion.

[LadyInTheRed]

Well, um, I don't mean to be impolite, but if you can afford to do that, why are you in bankruptcy?

braincramp was discharged in 2010. Perhaps the new car vice contributed to the need to file BK.

As you say in your next post, AC, I think we all have our spending habits that others find wasteful. The key is to make sure you can afford the spending. My weakness is food and wine. My grocery budget is huge, even after cutting it to get through my Chap 13. Good thing I can cook. If I had to eat out to satisfy my culinary tastes, I'd be in real trouble! But, I do splurge on eating out now and then. For our anniversary last month, my husband and I went out and spent $150 for dinner to eat our fill of sashimi. Probably not a good reason to dip into savings while in a Chap 13. But, it was a nice guilty pleasure that most likely will not hurt me in the long run.