Short-sale, foreclosure, and ch. 7 help!

[SJM]

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[keepmine]

First thing you do is stop worrying about your credit to the extent you may mess up your bk.
Here's the best option. Stop paying all debt you wish to discharge in bk. That includes the mortgage and credit cards. Stop using credit and use the $32K for living expenses until you file. Stop trying to negotiate a short sale. Let this be the lenders problem.

[freshstart32]

Well I can only go from my experiences and we filed Chapter 7 and did a short sale and I think it was the best thing we could have ever done. We were lucky that our bankruptcy attorney gave us the name of a local investor who handles a lot of short sales because our house had been on the market for a long time and it was about $20,000 over what some houses were going for in our neighborhood because of the horrible downward spiral on property values. We stopped paying all of our cards and we stopped paying our mortgage and let him take care of the rest. Our mortgage lender would have never done our short sale unless we were in the process of Bankruptcy. We had to wait about 3 months before it was completed because they won't start the short sale until you are getting ready to be warned about foreclosure but 3 payments missed was better than the foreclosure on my record at that point I felt. Ours went thru with no problems and so far to this day (it closed back in Sept. 2007) our credit report just shows that it was paid off in full. It doesn't show paid short or anything so it looks like we sold it and paid the loan off in full.

It's up to you and I know that your experience might or might not be as good as ours was but we had no problems with our short sale.

As far as the other stuff goes with the money and stuff....I am sorry but I don't have any information or advice to give about that!
Good luck!

[SJM]

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[rrockinggramma]

well keep receipts of how you spend it. Don't go on luxury cruises etc but food shelter transportation are considered essential. Just keep receipts. Document everything.

[erinmi]

A word of warning on short sales: forgiveness of the difference is NOT a guarantee. In fact, we short sold thinking it was and our mortgage company would not agree to the sale or closing unless we signed documentation that stated we would be responsible for the difference of nearly $40,000.

In the end, 7 months later we filed CH 7, so they didn't get the money after all. They had apparently just filed in county court for a judgment when we filed for CH 7. In fact, we never even got notice of the mortgage company's filing. The first thing we saw was the notice from the court that the case was dismissed because my DH was never notified about the case thanks to our CH 7 filing.

It sounds as if in your case, you don't want the house either way. So I agree that you should just stop paying your mortgage and other CC cards. Use the money on the sold property for living expenses. I

[SJM]

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[keepswimming]

This may be a dumb question, but what do you mean "use the money on the sold property for living expenses." ?