Opinion Needed - give up house or motion for payment abatement

[1aliasfan]

I am in Kansas district with the following problem.

We are in a 60 mo payback plan that we started in June 2009 at $861 per month. In June 2010, our payment goes up to $1061. Our house payment is paid outside the plan. We are confirmed.

My son has asthma and has had considerable health problems the last 6-9 months. While we did find some real issues, we also found mold growing in the carpet tack strips in his bedroom and then on the carpet (his room is in the basement and last spring our sump pump got stuck and flooded his room and part of the one next to his and part of the hall). We thought we had it all dried, but we never considered the tack strips and he has been severly allergic to mold for years. We even tried having him sleep in the family room for 2 weeks, then he slept in his room one night only to wake up nauseated and with a migraine, etc. So we know this is a problem.

I have a couple options but I don't know which way to go.

1) Tear up carpet, trim, tack strips, sheetrock - put together estimates to replace in 2 BR and hall; get letter from dr outlining all trips to office and medications, pictures of mold and then file a motion to abate payments for 3 months. (If I filed in April, I would request abatement for June, July and August to cover the 30 day notice to creditors and thus not have to deal with a refund from trustee, etc_

OR

2) Stop making payments on the house and let them foreclose. Use one month payment for deposit and another for first months rent. The way my attorney put it is that we could do this, mortgage company sell house at Sheriff's sale and then put unsecured amount on Chapter 13.

Does anyone have any experience on this? I really don't want to increase my stress level on this one, just get things fixed or move so that my son is healthy and we can live normally in our house.

Thanks for your comments.

[momofthree]

If you give up the house, will your trustee payment increase by the difference between the mortgage payment and the allowable IRS rent expense?

[1aliasfan]

Our current house payment is $1355. The Rent expense for Kansas is $920 for 4 people. However, they didn't balk at the house payment and you cannot get a nice 3BR with finished basement for less than $1200. Our attorney said they may want the difference and that is fine with us. We look at it as we won't be paying a house payment, no maintenance, no home warranty payment, etc.

[dlinid]

Two things, have you checked your home owners policy to see if it covers mold? Mine covers some with a deductible. Might want to look and see. The trustee would want you to look and see if you are getting any money from insurance for the home repairs.

On giving the house up, what would that do to your tax situation? We thought about giving our house up, but it affords us a pretty big write off and that keeps the IRS from taking what the trustee does not. Please visit with an accountant before you make this decision, they can tell you what the implications would be for you long term. Having to pay unsecured for a house that you can no longer live in is terrible, but I understand about asthma, dh has it and that is why we stay in our home. It is retrofitted just for his illness with no carpets and special whole house filtration on the furnace to keep his attacks down.

Good luck and please let us know what you decide.

[1aliasfan]

My insurance does not cover sump pumps or mold. Thanks for the tip on the mortgage write off on taxes. You are right, we got $800 back on federal this year but owed $600 to state, so I will look into the impact of no mortgage. Thanks.

[momofthree]

Our current house payment is $1355. The Rent expense for Kansas is $920 for 4 people. However, they didn't balk at the house payment and you cannot get a nice 3BR with finished basement for less than $1200. Our attorney said they may want the difference and that is fine with us. We look at it as we won't be paying a house payment, no maintenance, no home warranty payment, etc.

That's the beauty of having a mortgage in a chapter 13, they don't really care about the payment. However, once the mortgage is no longer there, they may very well expect you to get what you can for $920/mo, which probably won't be a nice 3 bdrm with finished basement--you may be looking at a 2 bedroom or an apartment, whatever $920/mo will buy. Check with your attorney as some districts are more lenient, but others are strict about the housing allowance....And then you'll be paying a higher payment at a lower standard of living...Again, just something to consult your attorney about, but since he already told you that they'll want to increase your payment, then I'm guessing you're probably in a stricter district.

Also, it's true you won't have home maintenance, warranty, etc. However, if your plan was calculated correctly, those should also be budgeted for in your plan payment, so if you get rid of the home, they may remove those expenses from your plan as well and increase your payment by those amounts. I've never gone thru this, so it's PURE speculation on my part, just trying to give you food for thought, and a list of questions to ask your attorney...

[NoMoreCards]

I just wanted to offer a suggestion as the parent of asthmatic kids.
Your son should NOT have a room in the basement due to the mold/mold spores that are almost always found in the basements.
Even fixing the problem (moldy tact strips and/or carpet) will not solve the problem. The simple fact that there IS a sub pump means there is moisture and where there is moisture there is mold/mold spores.

If possible, move him to another room and get rid of the carpet in his room.
If you have pets, keep them out of his room and his door closed.

Just wanted to offer ideas which may help. I wish you are your child the best.

Asthma is rough to deal with.

[1aliasfan]

Thanks. He is 16 and this is the first time this has been an issue with him. Was not a problem until now and we have to fix/repair everything no matter what we do. I don't have another room to move him to and he's off to college in 2 years anyway. He slept down there for 5 years without an issue.

[dlinid]

Your sons health is probably your most important concern at this point. I am so sorry that you are having to deal with all this bk stuff on top of it. Its is a terrible place to be. If you are planning on doing the fix/repair it will be important to keep spores from getting airborne. We did a remodel and my husband had attacks during the work and for a month afterwords. We did not tell the contractor that he was asthmatic and they did not take the proper precautions to keep the mold spores from spreading. You might mention this to whomever does the job for you should you decide to keep your home.

We use a dehumidifier and also an air cleaner in our bedroom to keep as many attacks at bay as possible. Both items in tandem seem to help. Could your doctor prescribe a humidifier and air cleaner? Maybe the trustee would see this as an extraordinary expense and let you take that out of your regular payments?

Good luck going forward.