nuclear option?

[stockbooi]

Someone mentioned earlier i should foreclose and file bk at same time. I don't get this idea. Live in my house rent free and save all this money. but then I would have 15-25k in my savings. Filing bk wouldn't work then because I would have all this cash. correct? maybe its still would be ok w/ chapter 13??? my foreclosure is strategic too so technically I can still pay, just don't want too because I would live in this shitty condo for the rest of my life. don't think this option would help my situation correct????

[tcreegan]

BK and/or foreclosure

Hello stockbooi,

Ethics aside, the idea is to stop payment on debt, wait until you get sued or foreclosure starts, then file BK.

You use the $$ saved to help rebuild your post-BK life.

Instead of keeping cars that you owe more on than they are worth, you find low-mileage used cars (still under warranty even) to keep through the BK. (WA, right? Keep equity below 5K total)

Take care of medical/dental/vision expense you have been putting off b/c you couldn't afford it.

Security deposit, 1st/last on a decent rental.

And most importantly: pay for a BK attorney

From your previous post:

backtoschool had the info on paying into the kids college fund

Over paying the student loans becomes a problem as it is a 'preferential payment to a single creditor'.

Don't have the wife go back to work the day after filing. Planning employment around a BK is fraudulent. Make a decision: Stay at home Mom or working Mom. This decision should not depend on the BK, there are more important factors here.

You mentioned an HOA, pre-filing dues owed can be included in the BK, but you owe the dues from the file date until the lender takes you off the deed.

And most importantly, did I mention getting a BK attorney?

Tom in Colo

[justbroke]

Great advice Tom.

[coak1875]

I was told that because student loans are not discharged in BK that paying them off would not be a problem with the trustie, I am assuming paying child support owed would be in the same boat. Because no matter what they have to be paid. I am filing BK 7 in may of 2011 and considering stopping my 1st mortgage payment as of this September. So I called legal helpers to find out about the student loan and that is what I was told. Do any of you think that stop paying the mortgage now even though not filing until May 2011 is a good idea. That date was sent by the attorney, he felt that in the meantime saving the money would be best as it would take that long before anything happens with my house that's $200K under water. HELP SUGGESTIONS!

[HakunaMatata]

Someone mentioned earlier i should foreclose and file bk at same time. I don't get this idea. Live in my house rent free and save all this money. but then I would have 15-25k in my savings. Filing bk wouldn't work then because I would have all this cash. correct? maybe its still would be ok w/ chapter 13??? my foreclosure is strategic too so technically I can still pay, just don't want too because I would live in this shitty condo for the rest of my life. don't think this option would help my situation correct????

I often refer to my situation as strategic default wrapped in a pretty BK bow. My underwater money pit house was no longer worthy of financial effort. I wasn't willing to further invest in a losing investment (plus, I didn't have the funds to correct existing problems). I live in a deficiency judgment state and I was concerned with the notion of a DJ surfacing. This concern placed me on the BK path. I weighed the pros and cons of foreclosure and BK. BK offered more pros than strict foreclosure.

The BK/foreclosure combo needs to be strategic. You need to familiarize yourself with exemptions and time your filing properly. Obviously, you want to make sure the money you're able to save prior to filing is protected. Post-filing, you can continue to save and remain in your property throughout the foreclosure process.