Losing your home and needing to rent?

[Mark80]

How do you get someone to rent to you when in bankruptcy? Since I am not discharged yet will anyone even think about doing that? Most companies that handle home properties do credit checks. Anyone have any tips or advice on getting people to work with you, or is it impossible for us!

[HHM]

Just start applying.

Also note, you can stay in your current home through the BK. The house still has to go through the foreclosure process. Unless you filed the day before sale date and the mortgage company filed a lift stay the next day after you filed, you will be able to live in your current house well past discharge.

Property Managers are generally only looking for ONE thing on a persons credit report, a prior eviction. They could honestly care less about a BK, in fact, many prefer a recent BK (reletive to someone with half-a-dozen charge-offs and collection accounts) because it means you don't owe anyone else any money, so you can more likely afford to pay rent.

[justbroke]

I wish I knew HHM before I filed... and moved. But that's neither here nor there...

I echo the comments. Just apply to different places. If your credit hasn't been dinged too much yet, apply to some apartment complexes and tell them you're moving in 2-3 months. This will get the background and credit checks out of the way early.

Also, just apply. Don't worry about dings from your credit being run because your credit is probably already bad. In any event, be prepared to talk about your situation. Many landlords understand.

I, as a Landlord, had to understand.

[Mark80]

Oh no, lol, my credit has been destroyed and my court date is Wednesday. I stopped paying on my unsecureds back in July so its real nasty.

I'm also looking for a house and one big enough for my family of 5. My kids are also in school so I am trying to stay in the disctrict so they aren't effected to much.

I was thinking I would get lucky and find a person who is renting outside of a large company. That way I can meet with them personally and take care of things.

Ok so my house cannot be forclosed on until after discharge? I thought they could file a motion to have that set in during the discharge period?

Thanks

[justbroke]

I'm also looking for a house and one big enough for my family of 5. My kids are also in school so I am trying to stay in the disctrict so they aren't effected to much.

Try Craigslist! Seriously! I used that to find a house to rent (5-bedroom, 2,400squeets and a pool). The owner "understood" and was more concerned about a person who had a steady job and could afford it, over someone who just had a foreclosure. He chose me and my family over someone with a lot better credit, but questionable stability. Showing up with your family, when looking, helps on the emotional factor.

Ok so my house cannot be forclosed on until after discharge? I thought they could file a motion to have that set in during the discharge period?

Most wait because they want to offer you some sort of deal before they actually foreclose. They do have to file a Motion with the court to file before the case is closed.

It's not a function of they can't foreclose until after discharge. It's a function of time. It takes time to foreclose and if you're in certain States, it can take 6 months for a foreclosure to be complete through sale.

What HHM was conveying is that if you weren't already in foreclosure at the time of the filing, then the Bank would have to meet all the foreclosure requirements and be subject to the timeline imposed under non-bankruptcy (State) law.

[HHM]

As far as the foreclosure timeline, that depends on where you were in the process when you filed BK. Yes, they can file a Motion to Lift Stay...generally, it would be rare that they could "complete" the foreclosure before discharge since most states, foreclosure takes several months.

Honestly, I don't think you are any better or worse off renting from an individual than from a property management company.

[Mark80]

I was thinking renting from a person might be easier, but if a company would be willing to overlook my credit obviously I would be fine with that!

I am meeting with my Attorney on Dec 8th to go over this situation and see what I need to pay in rent to make sure I don't lose my chapter 7 status!

My wife already found some places that would work, but I don't know how cheap I can go!


Thanks for the help!

[HHM]

You need to make your decision based on your financial needs, not the BK. Don't rent a more expensive place than you need simply to fit into a BK.

Keep in mind, you get to claim the mortgage amount on your BK forms anyway. So the amount of your rent is a non-issue.

[Martha13]

Hi Mark80--I just wanted to chime in here and 2nd Justbroke's comments about the family appeal..we too have a family of 5 and also wanted to keep the kids in the same school. We rented a brand new home just a few blocks away from our old one that is going into foreclosure. While technically we rented this one prior to filing bk (it was literally a few days) so we didn't bring it up, we were upfront about the fact that we would be letting our house go into f/c...the owner of the new home kind of viewed that as a "blip" and was much more concerned about our stability, timeframes, ability to pay going forward, and our general "goodness" for lack of a better term. I actually emailed them a picture of our family, as well as our previous home, to show both how normal we looked, haha, and how well we took care of our previous house. That was a much bigger concern with the owner, and he went with us instead of other renters for many of those reasons. Good luck to you and your family!

[Mark80]

You need to make your decision based on your financial needs, not the BK. Don't rent a more expensive place than you need simply to fit into a BK.

Keep in mind, you get to claim the mortgage amount on your BK forms anyway. So the amount of your rent is a non-issue.

I thought the same, but the paralegal mentioned that letting my house forclose could kick me out of a Chapter 7. Since I suppose I all of a sudden had an influx of disposable income? I did go ahead and make an appointment to speak face to face with my Attorney on Dec 8th. I guess I will have to get the entire story, maybe its different where I live?

[HHM]

This is a district specific issue, but most of the case law sides with the Debtor. For purposes of the means test, you claim your CURRENT mortgage expense. After all, at the point in time you file your case, your "present" housing expense is the MORTGAGE.

Note, you do not state that you are going to surrender on your Statement of Intentions. Your "intention" is to keep the hosue if the mortgage company would let you (but the mortgage company is not letting you).

[Mark80]

Thats a very good point HHM, I spoke with the Paralegal this morning, maybe she was just confused on the situation. I'm guessing I should still sit down with my Attorney and see what he thinks we should do. But I at least feel better now that I can most likely just step away and rent if needed.

And sorry again for all the threads!

[jeb]

Ref foreclosure and bankruptcy -

There are several things to look at if one is facing foreclosure and also filing bankruptcy.

First, I was a Real Estate agent here in central Florida and worked with people who were facing foreclosure.

I totally don't understand why the lenders would talk with me, negotiate serious reductions in the interest, payments and loan amount but wouldn't even talk with the people who own the home. Does not make sense but that is the way the industry works.

I assume the debt negotiation industry is the same - they won't talk to me, at least to the degree they will to those I pay.

One of the things you may be able to do in bankruptcy is re-negotiate your home loan. Believe me, right now, the last thing a lender wants is to get your home back.

Without doubt, you home is worth less - if here in Florida, much less - than it was a couple of years ago.

You can go back to them and, in effect, "buy" your home at today's prices - with a serious cut in interest rates and, therefore, payments.

Since it can take up to $35,000.00 for a lender to foreclose on a home and with all the political pressure on them to "help" people stay in there homes, they are much more willing to work with you. (It use to be all but automatic that they started foreclosure after 3 months of missed payments - right now, some people have missed 9 months and the lender has not moved forward.)

I do caution you on this, however - you will need someone to do this for you - - and not just an "attorney".

It needs to be someone that has been working in this area and can "prove" to the lender that the home is worth far, far less than they think it is worth. Like many areas of legal type issues, this is a specialty and someone that has been working with the same lenders day in and day out will be able to give you almost to the dollar what they can get the lender to accept.

The best of luck to all in this situation but, like bankruptcy, if done right a re-negotiate and a bankruptcy can be a real win, win, win for all - expect for the Ccard industry, of course.

And please don't contact me on this - I am no longer handling nor recommending anyone to handle foreclosures. - jb

[jeb]

PS - I am not talking about a "short Sale" here but a "re-negotiation. Two totally different things. - jb

[yeahdischarged]

We moved due to hubby's job and were forced to rent in a new area. We contacted a great property management company and they were happy to work with us. When we found a great home, they asked if there was anything in our credit that would be a problem, and we were honest and explained our recent BK 7 discharge and explained why - job loss and my health crisis. It was NO BIG DEAL at all. They didn't raise our deposit, nothing. They had already fallen in love with us, and hubby did make good money at his new job. We got a great house with a pool, just gorgoues and perfect for us - the owners had chosen to purchase another home and couldn't sell this one. First time it had been rented. Just the perfect colors and home for us. We are even allowed 2 pets! Just perfect all the way around, and certainly wasn't what I was worried it would be.

There are more and more people in this situation. Just go with a property management company and be honest. Worked for us! (But since bankruptcy, we hadn't missed any payments at all, so that definitely helped.)