Hi, I'm new and you guys are awesome!

[jlynn275]

I've been reading this forum off and on for a while and finally joined so I wouldn't "max out" from lurking This place has such great information, I have learned more here than anywhere else I've researched (and from the 3 lawyers I've consulted). So thanks!

My husband and I are planning to file a chapter 7, but our attorney is going to run a means test to make sure we will qualify because we are over the median income (esp as of Nov. 1), but only by very little. I did the means test on NOLO and we passed with a negative means amount. We have two mortgages, a car loan, $36,000 in credit card debt and the only "asset" we have is my husband's beat up car that's partly in his mother's name. I was originally looking into 13 but then met an attorney who threw a wrench (or a life boat) into that plan by asking us why we wanted to keep our house that is $70,000 under water in just the 4 short years since we purchased. First time the thought of not reaffirming my house had even occurred to me, so I came here to find it's more common than I would have thought. My house is 17 years old, needs about $20,000 in work and was intended to be a starter house for us, but if we don't take advantage of this bankruptcy I will be visited here by my grandkids at the rate the economy is going...assuming we ever have children.

It's really scary to think about because everything is so unknown. Like how much time would we have to save? Will someone even rent to us, especially with a fresh BK and two cats? Anyway, I'm rambling...I do have a question or two.

#1. We applied for a loan modification or some help with our mortgage 14 months ago when we knew trouble was brewing (we both got pay cuts, husband's was huge, and I increased my commute by $200 in gas a month)...I wanted to be proactive. We have called at least 3 times a month for the past 14 months and it's still "in review" and we assume it's because we weren't late except one time. We are, however, late now and have no way to pay. But I am wondering how it works if the next 2 months (while we wait to file) they finally try to offer a modification. I assume the modification would only hold up if we reaffirm, but I don't know? If something happens and we decide that whatever they might offer is too good to pass up, what happens? Does this question even make sense?

#2. My attorney said she doesn't know the answer to this and I've read conflicting posts here about this...
Does discharging your mortgage in Ch. 7, then foreclosing on the property show up as both on credit reports? Even if it's a year or more after discharge the foreclosure takes place? Does anyone know for sure years after the fact?

#3. On the forms to fill out it asks about debts paid back within 90 days of filing that exceed $600. We plan to continue paying my car, which is $391 a month and by time we file that will exceed $600, not to mention my mortgage payment for one month. What does this mean and will it be a problem?

We are in Florida if that matters. So many different laws. I appreciate any feedback!

Thanks!

[scorpion35]

I've been reading this forum off and on for a while and finally joined so I wouldn't "max out" from lurking This place has such great information, I have learned more here than anywhere else I've researched (and from the 3 lawyers I've consulted). So thanks!

My husband and I are planning to file a chapter 7, but our attorney is going to run a means test to make sure we will qualify because we are over the median income (esp as of Nov. 1), but only by very little. I did the means test on NOLO and we passed with a negative means amount. We have two mortgages, a car loan, $36,000 in credit card debt and the only "asset" we have is my husband's beat up car that's partly in his mother's name. I was originally looking into 13 but then met an attorney who threw a wrench (or a life boat) into that plan by asking us why we wanted to keep our house that is $70,000 under water in just the 4 short years since we purchased. First time the thought of not reaffirming my house had even occurred to me, so I came here to find it's more common than I would have thought. My house is 17 years old, needs about $20,000 in work and was intended to be a starter house for us, but if we don't take advantage of this bankruptcy I will be visited here by my grandkids at the rate the economy is going...assuming we ever have children.

It's really scary to think about because everything is so unknown. Like how much time would we have to save? Will someone even rent to us, especially with a fresh BK and two cats? Anyway, I'm rambling...I do have a question or two.

#1. We applied for a loan modification or some help with our mortgage 14 months ago when we knew trouble was brewing (we both got pay cuts, husband's was huge, and I increased my commute by $200 in gas a month)...I wanted to be proactive. We have called at least 3 times a month for the past 14 months and it's still "in review" and we assume it's because we weren't late except one time. We are, however, late now and have no way to pay. But I am wondering how it works if the next 2 months (while we wait to file) they finally try to offer a modification. I assume the modification would only hold up if we reaffirm, but I don't know? If something happens and we decide that whatever they might offer is too good to pass up, what happens? Does this question even make sense?

#2. My attorney said she doesn't know the answer to this and I've read conflicting posts here about this...
Does discharging your mortgage in Ch. 7, then foreclosing on the property show up as both on credit reports? Even if it's a year or more after discharge the foreclosure takes place? Does anyone know for sure years after the fact?

#3. On the forms to fill out it asks about debts paid back within 90 days of filing that exceed $600. We plan to continue paying my car, which is $391 a month and by time we file that will exceed $600, not to mention my mortgage payment for one month. What does this mean and will it be a problem?

We are in Florida if that matters. So many different laws. I appreciate any feedback!

Thanks!

i'll answer #3
your car is a secured debt so the $600 limit doesn't apply
it only applies to unsecured debt like credit cards etc

[Freddy03]

Welcome to the forums!!! This board has been a lifesaver to me! I'm so happy I found it. I'm in FL also and in the process of filing Ch 7. We are filing late Nov. We are not going to reaffirm our mortgage as we are underwater by almost 90k. We plan on staying and paying for as long as we can (about 3-5 years) then going to let the forclosure process start (depending on the housing market then).

You can and should continue to make payments on all secured debt while in the BK process so house and car payments are fine

Good Luck

[dfgorals]

We were discharged TODAY & I can pass on advice from our attorney. Any delinquencies on your mortgage(s) prior to filing for CH7 will remain. Once you receive a discharge, your credit report should read IIB (Included In Bankruptcy) even if the foreclosure is after discharge.

Your mortgage company may not report correctly – so you can force them & the credit bureaus to make it state IIB. After the date you file, IIB should be the only negative statement on your credit report.

[jlynn275]

Thanks for the replies! Much appreciated.

[researchnerd]

Just wanted to say "welcome" from someone who has been down a similar road. We started out with Ch13 but converted to Ch7, and we've walked away from our beloved but underwater home in need of major repair. We were also unsuccessful in getting a mortgage mod, despite repeated attempts. It's really frustrating and I'm sorry you are going through this, but it does get easier.

I can't definitively answer your questions, so I'll defer to those who can!

[BKlooker]

You won't have a huge problem renting somewhere, especially if you had good rental history prior to your BK. Some places have credit standards, but i wouldn't be overly worried. I know people who have NOT done BK with credit scores in the low 500s who still live in gate communities

Also remember that foreclosure and BK is now rampant. If a complex denied everyone who doesn't have a 700 credit score a home, they would have a near-empty complex. Just explain to them when they ask what happened and that you did BK to reorganize, and you should be fine, just might have to pay a higher upfront deposit.

My situation isn't unlike yours. my house 4 years past purchase and 50K in the hole now (and needs repairs), 33K in CC debt, and no assets but my 8-9 year old car.

[tobee43]

#1. We applied for a loan modification or some help with our mortgage 14 months ago when we knew trouble was brewing (we both got pay cuts, husband's was huge, and I increased my commute by $200 in gas a month)...I wanted to be proactive. We have called at least 3 times a month for the past 14 months and it's still "in review" and we assume it's because we weren't late except one time. We are, however, late now and have no way to pay. But I am wondering how it works if the next 2 months (while we wait to file) they finally try to offer a modification. I assume the modification would only hold up if we reaffirm, but I don't know? If something happens and we decide that whatever they might offer is too good to pass up, what happens? Does this question even make sense?

we were in fact, in the same exact situation....however, ended leaving or vacating the premises while awaiting an answer from the bank for over a year...with now, both jobs lost we simply couldn't even afford the heat and utilities as winter quickly approached. do NOT reaffirm your mortgage...it can always be done later...actually here it is 2.7 years later we have been out of our house for over 2 years and the bank called us a few weeks ago asking ( THIS IS AFTER DISCHARGE AND SURRENDER)...if we would like to now reaffirm..??? excuse me..nope..it's yours now..called our bluff we live 1700 miles away...you wouldn't help me when we asked and NOW you want to help us...chase...also claimed two days AFTER our discharged that I OPENED a loan modification...are they nuts or what.

depending on your state if you reaffirm...go through loan mod.....accept it...file bk...get discharged and then default on your loan they....at least in OUR state could go after us for the deficiency between the mortgage and a sale...and there were NO caps on FEES or COSTS...so we could have virtually been up the creek without a paddle had we been accepted not knowing at the time we BOTH were going to lose our jobs...we could have filed and then still owed upwards to the amount of...300k with costs, fees, deficiency...etc...without being able to reopen a discharged bk....

#2. My attorney said she doesn't know the answer to this and I've read conflicting posts here about this...
Does discharging your mortgage in Ch. 7, then foreclosing on the property show up as both on credit reports? Even if it's a year or more after discharge the foreclosure takes place? Does anyone know for sure years after the fact?

sorry we are still in foreclosure after 2.7 years so this one i can't help you with as "fact". i can, however, tell you what our plans on the situation are. first now the mortgage is being listed as IIB...balance 0, on the credit report. if and when the foreclosure actually takes place, if they list it i will ask for it's removal as the docket number was listed and the property which is the collateral was surrendered already. therefore, no double dipping is allowed....LOL!! frankly, it really doesn't matter to us either way. i will get another mortgage on our present house one was or another within the next 3 years...period..(i know that's just positive thinking, but i will).

#3. On the forms to fill out it asks about debts paid back within 90 days of filing that exceed $600. We plan to continue paying my car, which is $391 a month and by time we file that will exceed $600, not to mention my mortgage payment for one month. What does this mean and will it be a problem?

usually not, you just reaffirm the car loan

[BKlooker]

My understanding is payments to secured debt don't count for the 600 rule, only unsecured like credit cards and such. A car is secure debt, so as long as you keep making payments on it through out and reaffirm it, it should be fine.....but double check with your lawyer.

[tobee43]

My understanding is payments to secured debt don't count for the 600 rule, only unsecured like credit cards and such. A car is secure debt, so as long as you keep making payments on it through out and reaffirm it, it should be fine.....but double check with your lawyer.

yes, bk, i do believe you are correct on that one.

[jlynn275]

wow, thanks again!!!

Re: the car. Attorney is advising us NOT to reaffirm it (since we are flipped) but to keep paying and they won't take it. Does this seem to be the case for most people?

[AngelinaCat]

wow, thanks again!!!

Re: the car. Attorney is advising us NOT to reaffirm it (since we are flipped) but to keep paying and they won't take it. Does this seem to be the case for most people?

Yes. In fact the consensus among most of the members is to do just that. If you have to walk away from the car later on, then you won't be held responsible for the difference between what you owe on the car, and what it sells for at auction.

Now having said that, some institutions, particularly Credit Unions, will insist on you reaffirming if you wish to continue doing business with them. If you plan to move your checking and savings accounts to another institution apart from the one the loan is with, then it won't matter.