Foreclosure questions

[HopelessInWA]

We are going to file Chapter 7 soon (with a lawyer). All along, we'd planned to keep our house. Our mortgage is very reasonable, we've never missed a payment or had trouble paying, and with all of the unsecured debt gone, would not have any issue paying.

Until now. I just got word that as of January 31, I am out of a job. I have known for a week, and have sent out resumes to 8 places already, with many, many more planned. I am pounding the pavement and am doing everything within my power to find a new job, but I am terrified of what will happen if I don't find a replacement job and have any sort of lapse in employment times. And, to make it worse, I cannot get unemployment because I was an independent contractor (self-employed). Once my paycheck stops, it STOPS.

I have been warned it can take two weeks to two months just to get a response from a resume being submitted, Friends have been out of work 1 to 2 YEARS and not for lack of trying to find work. If need be, I can do evening restaurant work or something, but it's not going to be enough to make ends meet -- we have three small children.

I'm just sick over this, and now we are figuring we need to let the house go. Primarily so we can bank the money we'd otherwise be paying to our mortgage so we have some money in the event that I am unemployed too long.

We need to figure this out relatively soon (and yes, I will be talking to my lawyer, but he's not available until next week) so I have a few questions:

- If you stop paying on your house during a BK, do you get two separate hits to your credit report (BK AND Foreclosure) or do they all fall under the BK?

- Anyone know about how long you can stay in your house after missing the first mortgage payment?

Help is appreciated. I am so scared that we are going to end up homeless soon.

[StartingOver08]

If you file Ch 7 and surrender your house, you will have only one "hit" - the BK hit.

Yes, you will lose your house to foreclosure, but the bank can not report that on your credit. If you decide at some future date to buy another home, the mortgage application will ask if you ever had a foreclosure and that is the time to disclose it and your BK (or when you are speaking to the loan officer). This is public record information and easily found. But it is better to have one hit than two on your credit report.

If the bank reports a foreclosure on your CR, you can get them them to correct it.

You can stay in your house for quite a while after you miss your first payment. Check with your attorney, but here in South Fl it is typical for the foreclosure to take a MINIMUM of 12 months and many, many (including mine) are 18 mths to 2 yrs. Every district is different so make sure to check to see what is normal in your district (normal for these unusual times!).

[willsurvive]

We had the intention of keeping our home so when our CH7 bk was filed that is what it said. We never reaffirmed. Due to a job loss, we will probably let our house go. I've been working on a loan mod, but without a decent job I doubt that will fly. For what it is worth, our last payment was 11/08 with Bank of American and we still haven't had a Notice of Default filed, and have no idea when foreclosure will take place (we were discharged in 4/09 but not closed yet due to assets). We are still living here rent free. I think you will have more time in the home than you think where CH7 bk is involved. It slows down the whole process greatly.