New to forum need advice BAD!!

[whatthe]

Ok, I just found this site and I'm starting to read all the posts but it's a lot! In the meantime can you help me with questions? Here's my story....

I had excellent credit all my life. Paid bills on time and lived within my means. I decided to buy a home. It's the American dream right? Things started to get a lil tight but I managed. Then I wanted a seperate rental property to help with the bills. During all this the economy took a turn for the worse. The rental has been my worst nightmare and I'm upside in value and it wont sell. I tried a short sell but that didn't work. Of course I have credit card debt and a couple of personal loans. Way too much for my income. I have been thinking about filing for about two years now. The pressure of trying to maintain every month was really getting to me! I just couldn't live with the idea of having bad credit and a bk on my record. Well now I don't give a darn! I have had enough!!!

I had to stop paying my condo dues which are pretty high. Now they are sueing me to foreclose on my home even though I'm current with the actual mortgage. At this point I don't even want the home. I can't get what it's worth plus it will be hard to sell with the high condo dues. I just need time to find somewhere else to live. The only thing I want to keep is my car because I have an infant and it's cold and snowy here. SO my first question is.....

I'm leasing the car but the lease is up in 4 months. I assume if I don't get started now and approved before filing I wont be able to lease another car. No I can't afford to buy a nice used car with cash. I need somthing reliable!! I always get a no money down and low car payment type of deal. Would it hurt my bk if I get a new car right before filing? I'm also thinking that if I get a three year or so lease that when it's up hopefully my credit will be okay to at least finance something at that time. Am I naive?

How do I handle my income tax return I plan to file soon. Am I expected to use all my refund on the bills even though I plan to file bk? Will I have to show where every tax refund dollar went? It's not going to be a huge amount but it will be income that I could really use for other thing at this point.

How do I handle the condo association lawsuit? Do I avoid it until I file for bk? They tried to serve me but I didn't answer the door (I hate living like this). I guess my point is I don't want anything negative on my record or credit until I get a vehicle. I KNOW it's coming, I just don't know how to go about dealing with everything.

How long will I have to stay in my home? I heard it can be up to a year. That would give me time to save money and start fresh!

I'm lost please help!!

[whatthe]

anyone?

[puggymoo]

It depends on how quick your bank is to start foreclosure process. They won't even send out a letter of deliquency til 3 months. Then at 6 months you will get a stack of certifieds that all say the same thing (the auction date). You don't have to really move until they sale it or kick you out after the auction. This would allow you to save money for a deposit on a rental and car. If a chapter 7 its value cannot be over 1k if paid off. In chapter 13 it can be 7k and paid off.

[whatthe]

It's not the bank it's the association thats trying to foreclose. I called the bank twice trying to get info on the process but the CSR reps were useless. They dont seem to care because my mortgage is actally cuurent.

What is the max value of the car if I'm leasing? chp 7

[free2breathe]

The association can try to foreclose or threaten to foreclose, but the first lien holder (mortgage company) would be paid first. The HOA will only get something for their condo dues IF there is anything left over after the foreclosure sale. Do you have equity in the condo at this point?

Also, if they get a judgment for those dues, and you file bankruptcy you can have the dues up to the date of filing included and discharged in your bankruptcy. The lien they get for the judgment will attach to your property, and again, nothing left over after a sale? Nothing for them.

[whatthe]

Oh I see. They went straight to a foreclosure instead of a lien on the property. I gave them a piece of my mind while I was still preg. I think they just want me out. I need to sue them for all the times maintenance staff half completed or ignored repair request over the years. They want you to have patience and understanding when they don't do what they are supposed to but you better not be late on those dues!!! Anyway, I just noticed in your siggie that you filed pro se!! How did you do that? Is it hard? I really don't understand why lawyers charge so much to file a bk when obviously you don't have the money to pay other debt.

[tcreegan]

Hi whatthe,

If you are going to file BK and move out of the condo at some point, stop paying the mortgage. Use that money to pay a BK attorney. (new place to live, car, etc)

The condo association wanting to foreclose is not surprising...but you might remind them that the 1st mortgage is going to get paid 1st...they only get leftovers...and even those evaporate if there isn't equity past the 1st.

To keep them at bay until you get the car situation taken care of, don't avoid them. Get the summons. I don't think it will be a foreclosure, my money is on a judgement lawsuit first, then they put a lien on the condo. Research the WI judgement process (and foreclosure process while you are at it) ...look for places where you have time to respond to something. Wait out these. If you ignore them, the process gets much shorter.

but the CSR reps were useless. They dont seem to care because my mortgage is actally cuurent ...also not surprising, sad to say. Amazing how missing a few payments gets their attention!

In Wisconsin you have the option of using state or federal exemptions...the federal will have a "wildcard" that you can use to cover the tax refund, cars, whatever. If you are letting the condo go, this can be ~10K But if you don't exempt it, spend it or lose it.

Lots of people buy a car going into a BK, replace a clunker for something reliable, replace a gas guzzler for high mpg, get out of a high $ lease and into an affordable one. Doing it now before your credit score tanks is a good idea. The 3 yr lease is about right, clean your reports, some rebuilding, you'll be surprised how your scores can recover.

Hope some of this is helpful,

Tom in Colo

[whatthe]

Thanks so much Tom!!!