In FL - I want to start over - when do I give up the house?

[Ishmael]

My first post here, please be kind.

My life is in shambles, and I'm a wreck. I'm self-employed (or was, until economy ground my biz to a halt). My biz partner/buddy and I have barely managed to scrape the bottom of the barrel since Christmas to pay the basic bills, but it's time to scuttle the ship and move on. I've finally come to accept that it's time to start over at 40. I'm alone here, and need some guidance. I'm in the Central Florida (Orlando) area.

I stopped making mortgage payments in January '09 (last payment was Dec 08). Stopped the CC's around the same time (9.9% to 36.9% overnight without a single late pay or min pay - are they nuts?). Yesterday I got served with paperwork for "Notice of Lis Pendens". I will be contacting an attorney this week to get the ball rolling.

Now my questions:

1) I want to surrender the house (not want, but I want out of the debt) - how do I do this with the least amount of pain?

2) At what point during my bankruptcy do I do this? I am planning on filing Chapter 7, and just want to wipe everything clean and start over.

3) When should I expect to actually have to move out?

4) What can I take with me, sell, etc (appliances, furniture, et. al), vs what has to stay (cabinets, doors, etc.)?

5) How long in general does this process take from start to finish?

Thanks for your input and support.

[StartingOver08]

Welcome to the forum!

You are in very good company here! We will help in whatever way we can to ease your pain about the process.

First of all, it is taking a long time to foreclose in Fl from the time of the Lis Pendens - the foreclosure timeline is running at least a year and I have seen 18 months or longer too. The banks just do not want to rush the foreclosures - they are too busy. If your house is upside down - you have a long time - if you have any sort of equity of course, they move more quickly. Equity is a rare thing now.

1) The least painful way to surrender your house is to do it in the Ch 7 filing - select surrender. You will have to ask your attorney if the Trustee is one of those that asks you to move within 30 days of the 341. It seems that there are some Trustees that do this (a friend of mine had to do it because her attorney did not show up to the 341 and sent a newbie attorney). I am still in my house. Last payment 12 months ago. My attorney says I have until the final judgement and he thinks that might occur in July (maybe).

Long story short (too late! ) - you have at least 12 months with the right BK attorney.

2) You put the surrender right on your Statement of Intentions at the time of filing.
3) Expect at least 12 months before moving - maybe more. Ask your attorney.
4) You can sell your personal items. You are not supposed to sell fixtures. Appliances are a gray area. Fixtures are those things that are attached to the property - not plugged in.
5) The BK process delays the foreclosure process. The BK process is 90 to 120 days.

[Ishmael]

StartingOver:

Thanks for the info! I'm just so distraught over this whole thing I think I'm going to lose my mind. I almost want to do this quickly, like ripping off a band-aid - get it over and done with.

What do I do with regard to responding to the Notice of Lis Pendens? Do I send them a letter, and if so, what should it say?

Since I want to give up the house, should I move out early, shutting off the utils, etc (to save some money)?

What about HOA dues? Should I stop paying them?

Thanks for your feedback.

[StartingOver08]

You can stay in the house without a mortgage payment for a very long time. Use this time to save money post discharge.

If you are moving to a place where you do not have to pay utilities - I suppose it would be a greater savings to you to move before you file. You just may want to take care of the BK before you move. This is something only you can decide. A lot of it depends upon which way you think you will recover faster. Recover emotionally, financially etc.

You do not have to respond to the summons, but if you do you will delay the foreclosure.

Bring a copy of the summons to your BK attorney right away so the attorney can respond. By filing and surrendering the house you are responding. In effect, the foreclosure is stopped during the automatic stay period of the BK. Sometimes the attorney for the bank will lift the stay to continue the foreclosure. After you are discharged the foreclosure continues anyway. Like I said, it takes a long time.

It is probably best to pay the HOA dues as long as you are there because the HOA can foreclose quickly - or put a lien on the house. This is up to you - you haven't filed yet. One of the little things is that the HOA fees get paid by the bank when you surrender the house. So if you file Ch 7 the HOA fees pre-petition get added to your BK. Since you are surrendering - the lien stays with the house and the bank pays the fees. That is how it works from a practical point of view here in Fl.

[questionson7]

is this thread still alive......

My homeowner questions are similar but with a few twists, I dont exactly understand the homeowner situation in chapter 7 I have done a modification and am current on my mortage but i would like to include my home in the chapter 7 I am preparing to file but have not hired an attorney yet. My credit card and personal debt is huge and i have depleted my 401k making minimum payments but are about to have my first month of deliquent payments on those. If i am current with my mortgage and would like to stay current throughout the BK process and even a couple of more years at what point will they ask me to leave and surrender the house as long as i am current on payments.

[Poorhouse64]

As far as I've experienced it.... as long as you are staying current with the payments and indicate that you intend to remain in the house (on your CH7 BK docs) you can stay there indefinitely and keep paying mortgage(rent), taxes & insurance. The mortgage company won't be sending you any re-affirmation paperwork (most don't)...but if they do, just don't sign it. You won't be able to pay online anymore, you have to phone your payment into the BK payment center at the mortgage company. After the BK discharge, it's just like renting the house..... and when you're ready to leave..stop paying..., the bank won't "evict" you quickly in 90 days, they will have to begin the long foreclosure process, which could be many many months -- once they figure out who really owns your note..

[questionson7]

this is cool...

Wow thanks poorhouse64 for the quick reply, never done a thread or forum before very cool... and that is what was implied to me but not really sure. I know little about the process can i ask a few more questions? I also have personal debt and the individual understands and has no problem with my debt to them being included in this process, is personal debt ie $30,000.00 ok to include? also, the only thing i have in my house worth anything is some antique dressers, vanity and a few collectibles etc and some rings and watches will the representative actually come to my house to look. I also transferred 7500.00 to a friend though a credit card 8 months ago through paypal to avoid the cash advance percentage rate and he immediately sent me the first 2500.00 which i paid my car off with. he is still holding 5000.00 which is all i have to my name with less income that bills do you think i will have to account for this transaction 8 (or 10 months by the time the process starts) later. Thanks!!!

[Poorhouse64]

On our BK documents, we listed everything. Even if it was a small $148 credit card balance -- all the way up to the BIGGIES a rental house & our primary house. We listed dried up 401k plans.... even the $17/mo. for life annuity left by spouse's deceased mother. We listed EVERYTHING.

I went room to room and listed each bedroom suit of furniture from 1987 (value $250), Television (broken) What was left of the jewelry I didn't already sell to pay bills, kids PlayStation games, LaZyBoy recliner couch with broken recliner....List people who owe you money (we are owed $30k but no chance of getting it !!!)... 2005 car with 140,000 miles, Just list EVERYTHING. Assign everything a price that you could reasonably sell it for -- like at a garage sale or classified ads.

Then the documents have you do the math..... add up the debt..... total and deduct the assets and VOILA !!!! You're BROKE you have a negative balance. That's how it was in our case.

We turned in all the paperwork to our attorney. The 341 hearing took 5 minutes, no credits showed up. The trustee took one look at our debt/asset docs and declared us insolvent. A few weeks later our BK was discharged..... over & done with. Oh...no one comes to the house to check out the broken LaZyboy recliner!! Now THAT would have been funny

[questionson7]

thanks appreciate you taking the time to share knowledge and experience, wont be able to log on for a couple of days but possibly you would let me "milk" your brain with a few more questions at that time?????? good night

[venicehope]

Hi, since your also in FL I thought you might like to hear our scenario. We filed Chapter 7 in Oct 2007, with the decision to surrender our investment home & private home. (We lost 150,000.00 of equity on the investment home-it foreclosed immediately...No equity at all in our private home, still sitting vacant)STUPID, STUPID & MORE SO NAIVE we depleted our life saving & IRA trying to continue to make our two mortgage payments & C.C.'s while waiting for the investment property to sell...never intending or foreseeing a bankruptcy. We had our 341 in Dec 2007 & the trustee found we had assets. I too listed every thing we owned on our documents. BE SURE to view the allowances in FL. Not much for auto allowance & in our case we only had a 2004 Toyota corolla that we decided to NOT re-affirm & just continue to make the payments. BTW we recently paid it in full & received the title. Our jet ski & my engagement ring however took us over the limit. Remember the value of your possessions are at a garage sale price point. Which is nearly nothing for most buyers. Sway on the lower end of value...to your benefit in keeping as much of your possessions as possible. I brought my jewelry to 3 different pawn shops & used the lowest offers to submit. Your trustee does not want to have to collect your possessions and sell them. He/she won't get anymore for them (possibly less at auction) and has to go through the expense of which. We were discharged in Jan. 2008, BTW moved out of our private home in Oct. 2007 before filing & rented (in fear of not getting a rental due to our filing/credit report...BIG MISTAKE) Meanwhile It wasn't until spring of 2008 that our attorney (whom was totally negligent...long story) negotiated with the trustee directly & basically said we would have to pay the trustee 3500.00 in 5 installments to keep the jet ski/& ring. NO options to negotiate or even surrender any of which (not that we intended anyway), by Oct. 2008 we made our last installment. It wasn't until about 14 months later when the case was closed. RE: BIG MISTAKE, our home still sits abandoned & not even touched by the bank (Wachovia/World). Locks haven't been changed & our old neighbors take turns cutting the grass to at least keep it from looking too unsightly. I have continually received statements from Wachovia about my loan payments, options to short sale, refinance/modify/ & D I L with a $5,000.00 bonus. I've disregarded all. Our names are still on the deed & recently the taxes were paid (3 years in rears) by some other bank I suppose putting a lean on the house. At this point we are guessing that the bank has lost/misplaced the papers on the note. It's been three years! That's three years of rent I could have saved! DON'T MOVE OUT OF YOUR HOME UNTIL THEY TELL YOU TO! Cleanse your home & lives/scale down & simplify. It'll be refreshing, start a new feeling, & easier to move when the time comes anyway BUT STAY IN PLACE RENT FREE. That's of course if you intend on surrendering the house. Oddly enough at this point we are wondering ourselves if we technically own the house? That's if the bank has no note & we have the deed. Contemplating on repaying the lien debt & moving back in. We're contacting an attorney on our options & if this could at all be true with the issues going on with the Banks paperwork. Could we actually own a home we were discharged on, free & clear. I'll keep this sight posted. Check out MERS.com to see if your mortgage was filed with them or not. Happy to answer any other questions. I'm not an attorney just sharing our experience with anyone who's interested. Believe me we've been through it all. Ya'll hang in there, there is light at the end of the tunnel.