Hello.
I've been studying foreclosures and Chapter 7 since we will be foreclosing in about 100 days (we will be delinquent in 50 days and then the foreclosure period starts).
It is our primary home that is foreclosing with a HELOC second loan with Wachovia. They say they will charge off the loan, so we don't know if they will sell it to a debt collection company or file suit for a deficiency judgment.
We also have a second home fixer upper (never rented it) that we want to move in to because we can afford that one. We bought it 3.5 years ago. There is little or no equity in the second one the values have fallen. We have a 30-year loan on that one in good standing.
Here are my questions:
1. We do qualify for Chapter 7 due to our income. Is it better to file bankruptcy before the foreclosure sale or wait until foreclosure has completed and the HELOC loan is charged off?
2. Our second home in in Alabama. There really isn't any equity in it ... probably upsidedown, but can we apply the $20,000 exemption to that property if needed? We want to keep the home.
3. Our HELOC isn't that old and wasn't used for the primary home. We did withdraw large amounts in cash for various uses. I'm afraid that the Trustee could challenge those. I saw that they look back at spending for 90 days in Georgia. Is that true? The last cash withdraw was in January. If the 90 days is correct, then we would have to wait to file in April or May. We do have time to wait since it will be approximately 110 days until the foreclosure sale. What is your advice?
4. Last question: I know that you can't go bankrupt on a single creditor. We also have one c.c. with a $4500 balance. Is the HELOC loan and the c.c. enough to qualify for Chapter 7?
Thank you so much. We've always been responsible with good credit. But between not being able to sell our home in this awful market and loss of my spouse's job, we find ourselves in unchartered waters.
Thank you so much for your help.
I've been studying foreclosures and Chapter 7 since we will be foreclosing in about 100 days (we will be delinquent in 50 days and then the foreclosure period starts).
It is our primary home that is foreclosing with a HELOC second loan with Wachovia. They say they will charge off the loan, so we don't know if they will sell it to a debt collection company or file suit for a deficiency judgment.
We also have a second home fixer upper (never rented it) that we want to move in to because we can afford that one. We bought it 3.5 years ago. There is little or no equity in the second one the values have fallen. We have a 30-year loan on that one in good standing.
Here are my questions:
1. We do qualify for Chapter 7 due to our income. Is it better to file bankruptcy before the foreclosure sale or wait until foreclosure has completed and the HELOC loan is charged off?
2. Our second home in in Alabama. There really isn't any equity in it ... probably upsidedown, but can we apply the $20,000 exemption to that property if needed? We want to keep the home.
3. Our HELOC isn't that old and wasn't used for the primary home. We did withdraw large amounts in cash for various uses. I'm afraid that the Trustee could challenge those. I saw that they look back at spending for 90 days in Georgia. Is that true? The last cash withdraw was in January. If the 90 days is correct, then we would have to wait to file in April or May. We do have time to wait since it will be approximately 110 days until the foreclosure sale. What is your advice?
4. Last question: I know that you can't go bankrupt on a single creditor. We also have one c.c. with a $4500 balance. Is the HELOC loan and the c.c. enough to qualify for Chapter 7?
Thank you so much. We've always been responsible with good credit. But between not being able to sell our home in this awful market and loss of my spouse's job, we find ourselves in unchartered waters.
Thank you so much for your help.
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