What happens if bankruptcy dismissed?

[questionsGA]

Hello. I'm researching Chapter 7 (we do qualify) in GA. What happens if either the bankruptcy is dismissed instead of discharged, or if we stop it in the middle because we don't like what they want to take, etc?

1) Does it still show on our credit report as a bankruptcy?

2) Would it leave us more vulnerable for the HELOC lender to file a judgment against us than if we just let our home foreclose and didn't try bankruptcy at all? (In Georgia the HELOC becomes a recourse loan even though the primary home since we can't prove that any of it was spent on the primary home. The HELOC lender could go either way ... loan is less than $55,000.)

We are on the fence as to whether to file or not. We will both be on SS by November, so they can't attach wages. Our second home that we want to keep has a full loan on it, so there is no equity (probably negative since the fall of the market). We don't want to keep our primary home (HELOC second loan on it) so it can foreclose.

I just don't want to jump from the frying pan into the fire if they dismiss due to large cash withdrawals last Nov., Dec., & Jan. (spent, but only a few receipts).

Thank you for your assistance.

[questionsGA]

I found the answers to my question above.

Hi, I found the answers I was looking for. To help any others that have the same question, here is the link:

http://www.higginsandassociates.com/chapter-13-bankruptcy/i-want-out-what-happens-when-your-bankruptcy-case-is-dismissed/

[JRScott]

Yes the filing would still appear.

There are two kinds of dismissal.

Dimiss w/o prejudice.

In this case you could refile at a later date and still seek discharge of the debt though if you file before 6 months is up you'll have to prove that you deserve a stay as it is reduced to only 30 days.

Dismiss w/ prejudice

You cannot refile or ever discharge the debt you filed on, generally only issued when you are committing fraud.

Yes the moment the case is dismissed any and all creditors can resume collection activities against you including foreclosure (However a second mortgage is unlikely to foreclose if the first mortgage is equal to the value of the home because they'd have to pay the first mortgage before they received anything themselves).

Also I think it is against the rules to post a link to a lawyers site......

[justbroke]

Hello. I'm researching Chapter 7 (we do qualify) in GA. What happens if either the bankruptcy is dismissed instead of discharged, or if we stop it in the middle because we don't like what they want to take, etc?

Unfortunately, a debtor may not be able to voluntarily dismiss a Chapter 7. There is no right to a voluntary dismissal in a Chapter 7. Once you file one, they take a life of their own. If you try to dismiss it, specially if you received a windfall and don't want to give it to the creditors, the Trustee will object to the voluntary dismissal, and will probably win.

1) Does it still show on our credit report as a bankruptcy?

Yes, for 10 years.

2) Would it leave us more vulnerable for the HELOC lender to file a judgment against us than if we just let our home foreclose and didn't try bankruptcy at all?

More than likely the HELOC would sell the debt to a Junk Debt Buyer (JDB) and they'd bother you.

[questionsGA]

Thank you for your answers

Thank you for your time. Very helpful. Sorry I linked to a lawyer's site. Won't do it again. Didn't mean to advertise for them ... was just sharing the info. Thank you for being pleasant about it.