questions, questions,questions

[emandmeagsmom]

My husband and I going to file bankruptcy, hopefully we can get it filed before foreclosure proceedings are started. Let me start from the beginning. My husband and I purchased a home almost 2 years ago. It was not a good deal. It was an arm 2years. Our interest rate was 9.75 and now it will be shooting to 12.35 in Septemer. payments around 895. The mortgage broker and the people who we bought from really pressured us into it. This was in July of 05. August 05, I had a blood clot in my leg and forced me to cut my hours back to around 20, I am a licensed hairstylist I worked for a major company. My pay was cut in half. Left there in Feb. 07 finally and worked at a private salon for 3 months making nothing not even enough to pay my booth rental some weeks. May I went back to a company. I have a good income now but I try not to work more than 26 or 27 hours a week, anymore than that and my leg aches really bad. We are 5 months behind on our mortgage and have about 10,000 in credit card debt and medical bills.

The questions I have: 1. I took out a title loan on my car and I am still paying on that. How bad is that going to be. If it is bankrupted, are they going to repo my car. It is our only one and we need it for work. What about internet payday loans. We took some out and had to close the account so they would keep debiting them. We dont even have a checking account now. We have been using all cash for a couple of months. Is that going to hurt us? Thanks for the answers.

[SinkingFast]

The bank acct issue could be tricky with the BK Court. You have to disclose all bank accts closed in the year (or 2) prior to filing BK. The Trustee is gonna want to know why you closed the acct, the final balance of the acct, where the money went, and what you're doing now.

You might consider opening a new bank acct with a different bank so you can create a paper trail for yourself. Pay checks into the acct. Buy Money Orders to pay bills so the money goes right back out. That way you maintain no balance of cash on hand for any Creditors to get.

Start saving receipts for every penny you spend. Buy gas for the car, get a receipt. Groceries, save the receipt. You're gonna need to know where you've been spending your money to complete Schedule J anyway. Saving receipts is a great way to know how much you spend on food, prescriptions, gasoline, clothes, etc.

You should be able to Discharge the PayDay loans in BK.

The Title loan on the car,.......... You can reaffirm that with the Lender if you really want to keep the car. Ponder your decision carefully tho. Make sure you don't owe more than the car is worth. Is the car mechanically sound or giving you problems?? If it's not in your best interest to Reaffirm that note, you can always get another car during BK. There are Lenders who specialize in selling to people during an open and active BK. You can ask attnys about it. They'll explain it to you.

Foreclosure,.......... You can surrender the house in BK and walk away. Any personal liability you may incur can be Discharged in BK. If you file an Intent to Surrender, the Lender will probably file a Motion to Lift Stay so they can proceed with the Foreclosure anyway. So you're gonna want to have a place lined up to move to.

To help you better know what to expect, we need to know what State you live in. Foreclosure Laws vary from State to State.

[emandmeagsmom]

We live in Mississippi. The account was closed because of the overdrafts from the payday loans.

[SinkingFast]

Mississippi foreclosures can go either Judicial or Non Judicial.

Judicial,.......... The Lender has to go to Court to get permission to Foreclose on the property. That process takes longer.

Non Judicial,......... You'll have a "Right to Sale" clause in your loan that will allow the Lender to begin Foreclosure proceedings without going to Court.

http://www.foreclosure.com/statelaw_MS.html

Lenders sometimes don't move right away to Foreclose. Depends on how many REO properties they are already carrying on their balance sheet. REO properties are negative assets that don't look good to prospective investors.

Maybe some one from Mississippi will chime in and relate their own personal experience. Foreclosures are so high right now in Ohio and Michigan that the process is moving much slower than usual. That might be the case in Mississippi as well.