Filing BK7 That Includes House and Unsecured Debt: When to Move Out??

[GrnEyedLady5]

I will be filing a BK7 in a few days, and I believe that I have a a pretty good idea of what to expect overall since I've been researching on my own for several months. I stopped making mortgage payments 11 months ago, and only just received the Foreclosure Summons about 2-weeks ago. I do have an attorney who will be working with me on the BK. My issue is currently about the best or most appropriate time to move out of the house since I'm anxious to relocate to an apartment.

My attorney has told me that I can move out any time I want, but I'm skeptical.

I cannot save nor do I want to keep the house--too old to fix up or rent out, too much work, not enough finances to cover everything on a single's income, unable to sell at any reasonable price due to extremely low market value(s), and owe over $62k on a $60k Equity loan. My house with an attached property is likely valued somewhere between $40k and $50k since surrounding properties are selling for as much. Two years ago, the place was appraised by the bank for only $70k! I'm not rich by any means--far from it, and most of the little I do have in "assets" are 10-12+ years old (furniture, appliances, etc.). The house is circa 1908 and my car is only worth $6200. I've been drowning in bills and other headaches, so I've chosen to file the BK and start fresh.

I just want to know when it would be best to move out without causing additional problems. Any thoughts, advice, or anyone with experience would be helpful.

[keepsmiling]

That depends on your own needs and goals.
Firstly, can you exempt all that cash you haven't been spending? Let's assume you can.
Many choose to live rent free for absolutely as long as possible and maximize their emergency/new home/savings/whatever fund. Others want to just move on and get their new lives going. You could conceivably have YEARS of free living in that house. Many here have.
I think a lot may depend on how long you think it will take you to find a place to live. Have you started looking?

[nohoneymoney]

First step is to be sure to cover you car and cash. As for the house, it is up to you. Since it is underwater it is not likely the trustee will try to sell it. There is always a chance these days for trustees to try a carve-out but not likely worth their time given the value of the property. If you want to stay as long as possible, I would list my intent in the BK petition the equivalent of as 'stay and pay'. Then work the bank to delay the foreclosure for as long as possible. Build up money to fund your fresh start. If you don't want to stay, your attorney is correct: you can leave any time you want.

[GrnEyedLady5]

Thanks for your reply. I'm sure that I can handle the cash situation. My attorney has already advised me about it. Under any other "normal" circumstances, I'd likely stay for as long as possible, but the place is too distressed and distressing. I really need to get out of the place badly...for my mental health. I've been holding off on filing and/or moving for some time due to personal family issues, but I have been looking around for an apartment. I figure that after I file, my search will be more intense, and I hope to be out sometime between June and July. It would just feel weird in a way to move out when I'm in the middle of the BK process, which was my main concern. What can I take with me on the move that wouldn't be scrutinized by a trustee in some way? Do I just take what I need, or leave everything and start over from scratch?

[GrnEyedLady5]

Thanks for your reply. My attorney told me that he can cover the car and that I should watch my cash to keep it within means or below.

[jst4f]

What can I take with me on the move that wouldn't be scrutinized by a trustee in some way? Do I just take what I need, or leave everything and start over from scratch?

I don't see how BK would affect what you take with you. I wouldn't sell any of it as those proceeds would belong to the trustee. If anything leaving anything behind could be view, I suppose, as abandoning it. I think that is a stretch. If concerned, wait until after the 341meeting to see if you are a no asset case to be safer wait until after discharge. Check with your attorney to be sure.

[btbeme]

First things first. Make sure you exempt what you can. Then, upon filing, I strongly suggest not moving until after your 341 at the earliest. If there is any chance of being an asset case or any other complication, wait until after your discharge.

In the meantime look for a place you like and can afford. No rush. Realize that a rental property might want a larger security deposit because of your BK. Be up front with them about your situation so they don't pull the carpet from under you as you are moving in.

Don't sell anything once you file, and I suggest that you don't do so before you file, either - just more paperwork to do if you sell stuff. After discharge you can do whatever you want.