Chapter 7 do they still have to foreclose?

[momisery]

If you file a Chapter 7 do they still have to foreclose to get the property back and do you know they are doing that? Or do you get a letter to vacate?

[JRScott]

They still have to foreclose on the property.

[tdawg]

Trustee can sell property without foreclosing?

At my 341, the trustee asked what number would be good to call me at so he could have someone take a look at my house. The lawyer said that the reason he said that is that he might try to get some cash from the mortgage holder (Wells Fargo) to sell my house. I told her that I am current and that the house definitely has negative equity - I bought it August 2008. She said that doesn't matter, that they could do a short sell, and the lender might give the trustee $10,000 or $15,000 to take care of it. She said I might not know until just before discharge if he decides to do that.

This really surprised me and seems contrary to what I've heard. Has anyone seen this happen? If so, then how long do they let you stay in your house before you have to leave? By the way, it's a VA loan, so I wonder if the Veteran's Administration would be able to provide me with any help here.

[frogger]

They still have to foreclose on the property.

Yes. Foreclosure insures that the lienholder has clear title to the property.

[JRScott]

Not heard of that tdawg, sounds kinda shady , where you surrendering the house?

[tdawg]

Not heard of that tdawg, sounds kinda shady , where you surrendering the house?

Western Washington. I'm unemployed now - interviewing and trying to find a job, had my 341 before Christmas.

Yea, it sounded pretty weird to me too. The lawyer acted like it was normal (and the trustee's right). My DMI is very negative because I was laid off in November. So, if I can't get a new job in the next 6 months, I'll lose the house to foreclosure regardless. But I'm current right now.

[HHM]

At my 341, the trustee asked what number would be good to call me at so he could have someone take a look at my house. The lawyer said that the reason he said that is that he might try to get some cash from the mortgage holder (Wells Fargo) to sell my house. I told her that I am current and that the house definitely has negative equity - I bought it August 2008. She said that doesn't matter, that they could do a short sell, and the lender might give the trustee $10,000 or $15,000 to take care of it. She said I might not know until just before discharge if he decides to do that.

This really surprised me and seems contrary to what I've heard. Has anyone seen this happen? If so, then how long do they let you stay in your house before you have to leave? By the way, it's a VA loan, so I wonder if the Veteran's Administration would be able to provide me with any help here.

That is a new one to me;

That doesn't sound right.

[tdawg]

This shows up on pacer:

"Trustee's Initial Report. The trustee of this estate reports that the meeting of creditors was concluded and the trustee is investigating the existence and location of property of the estate not subject to exemptions or security interests. (Trustee name redacted)"

I'm hoping that once they realize that the house has no equity (which would be pretty easy to figure out), he will change this to report of no asset.

[HHM]

Granted, it is a creative tactic of the trustee, but I am not sure it is viable.

[jdhelmser]

Chp 7-do they still have to foreclose

I'm not an attorney, but I would like to caution everyone about advice on this forum or any other forum. Please seek the advice of an attorney. For instance, in a Chp7, it is not necessarily true that you must foreclose. Banks are reluctant to foreclose and a workout is a win win. Lots of factors involved. JD

[frogger]

I'm not an attorney, but I would like to caution everyone about advice on this forum or any other forum. Please seek the advice of an attorney. For instance, in a Chp7, it is not necessarily true that you must foreclose. Banks are reluctant to foreclose and a workout is a win win. Lots of factors involved. JD

I think that we all agree that your attorney is the best/final source of advice.

If you're in a 7 and want to keep the property, then a foreclosure is not mandatory. If you are giving up the property, it will be foreclosed on.

[momisery]

We are surrending the home, so we will not be trying to work something out, but thanks. I was just wondering if they had to go thru the process of foreclosing. I have not received a letter telling me they are going to on our home or on the rental in another state. I am willing to give them up, even talked to WF about the rental but they wanted 1800.00 to "work out the return of keys deal" with us.. geesh.. we don't have 1800 we went BK.. Anyhow, thanks for the info, and I hold no one responsible if anything goes wrong, I just ask questions based on what is the norm, but I know it is different many times in the end for each case. Thanks again.

[momisery]

One more quick question, will they serve us to foreclose, or just mail us something?

[frogger]

One more quick question, will they serve us to foreclose, or just mail us something?

Probably both.