In a chapter 13 and may want to walk away from house - Questions...

[coopersmydog]

I've been in a chapter 13 for about a year. Recently took a new job in a different state, and am renting an apartment.

I no longer have a need for my home in my previous state. The way I understand it is I can surrender the property, the bank will forclose, and any money I would owe them if they took a loss would be discharged upon completion of my plan.

My question is how will this affect my ability to get another mortgage when I complete my plan? Am I missing anything? I just don't see why I'd keep the home.

[momofthree]

I *believe* the mortgage would state "included in bankruptcy" or "IIB" on the credit report, so it shouldn't affect you any more than the bankruptcy itself. I don't have personal experience in this though, this is just from what I've read here on the forum.

[coopersmydog]

Thanks. Anyone else have experience with this?

[coopersmydog]

One last try. Anyone?

[newbie2]

I've been in a chapter 13 for about a year. Recently took a new job in a different state, and am renting an apartment.

I no longer have a need for my home in my previous state. The way I understand it is I can surrender the property, the bank will forclose, and any money I would owe them if they took a loss would be discharged upon completion of my plan.

My question is how will this affect my ability to get another mortgage when I complete my plan? Am I missing anything? I just don't see why I'd keep the home.

I don't know how it works to surrender your home once you have been in a Chapter 13 plan for a while, but I can tell you that getting a mortgage after a foreclosure and a bankruptcy filing will be the same for anyone who has done this. You will have to rebuild your credit scores and wait at least 2 years post-foreclosure and bankruptcy to meet the new guidelines by the lenders.

[Flamingo]

Well, your entire Chapter 13 will have to be modified if you stop your mortgage payments and your Plan can be dismissed if you just stop them. See your attorney right away.

[coopersmydog]

My plan has to be modified anyway because we moved to a new state for a new job. I'm working with my attorney, just wondering if anyone else has done this and could provide some info.

My house payment isn't paid as part of my plan. Not sure if that matters or not.

[newbie2]

My plan has to be modified anyway because we moved to a new state for a new job. I'm working with my attorney, just wondering if anyone else has done this and could provide some info.

My house payment isn't paid as part of my plan. Not sure if that matters or not.

It doesn't matter if your payment is paid by you or the trustee. The amount of your payment is included in your budget, and that is what will be scrutinized. (If you rent for less, then that frees up funds for the unsecureds.)