Which should happen first?

[tlb]

I apologize if this question has already been asked. I've attempted to search the forum but feel a little overwhelmed by all the info on here. (that's a good thing)

Husband was laid off in January. We abandoned our home. Got several letters from the bank (Citi Mortgage) but nothing yet on any foreclosure proceedings. Our last payment was in January.
We have 60k in cc debt and plan on filing Chapter 7, as my husbands income is only 49k and we have 4 children.

We haven't contacted a lawyer yet.

My question is this....do we need to wait for the foreclosure to happen before we file for bankruptcy? I'm not sure if the two go hand in hand or if they're completely seperate deals?

Thanks in advance for your input.

[liz417]

You do not have to wait for the house to go into foreclosure to file bk. The deficient balance on the house will be included in the bk.

Good luck!

[freshstartfl]

As others have said, though, it's less damaging to your credit if you file BK before a foreclosure happens. That way there's only one "major ding" on your file.

[tlb]

As others have said, though, it's less damaging to your credit if you file BK before a foreclosure happens. That way there's only one "major ding" on your file.

Help me understand....If we file BK, does the foreclosure not show up on the credit report?

[liz417]

Help me understand....If we file BK, does the foreclosure not show up on the credit report?

No, your mortgage loan/credit report will say, "IIB" (Included in Bankruptcy), unless you reaffirm the loan.

[kenshirley]

You need to check the means test and find out what the income levels are for your area.
I would think in almost any area of the country that your current income with 4 kids will put you under the means if you want to go chapter 7 easily.
The important thing to remember is that they count all income for the last 6 months prior to filing so you need to watch for that income that was received from his last job in Jan and maybe Feb if the checks came then.
Waiting for the foreclosure notice is a waste of your time if you want to get the creditors off you back particularly considering the fact you have already given up the home.