About to file and having major panic attacks

[kbuy]

My husband has an appointment to see the lawyer in 2 weeks. The idea initially was that he'd file for chapter 7, I wasn't going to file as we thought it would be better to have one of us with some sort of "good" credit. (In some of my other threads I explained that we're moving to the UK once this mess is over with).

Couple of questions though (we'll clarify this with the lawyer when we see him but Im in a major panic right now)

1. When we leave the country,we thought maybe we could just rent the house out. But what would happen if the renters don't pay the rent i.e the mortgage wouldnt be paid and so at some stage the house would be foreclosed on. We know his pension would be protected by filing chapter 7 on his current debts but can a mortgage company garnish a pension if the house is foreclosed???

The mortgage is on joint names. If he adds the house to the chapter 7 - then I'll be liable for the house. I wouldn't be able to pay the mortgage so what would be the worst scenario?? If they foreclosed, how long does that process usually take? He's due to pay the mortgage on the 15th of this month.

On the one hand, I think by adding me to the chapter 7, include the house, then it's freeing us up of everything before we leave the country. On the other hand, by adding my debt it will give us extra $495 a month, plus we won't have the mortgage which is $1,360 a month - we really don't want to be forced into a chapter 13/repayment.

Or, should he file for chapter 7, and we'll just hand the keys back to the bank?? how does that work??

I'm just interested to see what everyone else would do.

[frogger]

On the one hand, I think by adding me to the chapter 7, include the house, then it's freeing us up of everything before we leave the country.

If you really want a fresh start, then get out of the house if you can. Depending on a renter to pay for it is more than likely going to get you right back into a bad situation.

If you can make the numbers work, then my advice would be for you and he both to file, get it over with, and not have to worry about it any more.

Good luck and keep us posted.

[Snax]

I don't see how you could remain untouched by your hubby filing if the house is included since you can't cover the mortgage yourself.

[LimpDisc]

What about choosing to keep the house, but not reaffirming the mortgage? That enables you both to file and claim the mortgage expense to quailfy for CH7. When the time comes to leave the country you can turn the house into a rental. With the mortgage being discharged in BK you won't need to worry about a non paying renter.

[Mitthew]

There is a better chance of your acquiring the ability to control the weather with your mind than there is of you walking out of the bankruptcy process with a house that you have not reaffirmed the mortgage on. Your mortgage is a debt secured by the house. Further, something to keep in mind is that after the bank sells your house at a loss to another buyer, they are going to come after you for the difference. I would not want to fight that/deal with that while adjusting to life a a country with terrible food ;-).

[Snax]

. . . Further, something to keep in mind is that after the bank sells your house at a loss to another buyer, they are going to come after you for the difference. . .

That's not entirely correct, as it depends on whether the state allows deficiency judgements or not. Some do. Some don't.