Surrendering home

[howie]

Has anyone surrendered a home under chapter 13? I have two mortgages and am upside down. I am planning on surrendering and was wondering if the mortgage companies get any money or do you just walk away?

[rrockinggramma]

well after they foreclose, the deficiency would become unsecured and they would be treated with all of your other unsecured creditors. I didn't have a home to surrender in my chapter 13. I am curious though, if you are above the means and that is why you are filing a chapter 13, if you are not trying to save your home.

[howie]

I am very much over the means. My lawyer, who is supposed to be one of the best in southern Ohio, told us that in most cases when you surrender you will not have to pay anything on the home. I was just wondering if that was what anyone else had experienced. He said in over 8000 cases, he had only two that had to pay anything on a surrendered home.

[rrockinggramma]

I would bet that to be the case. By the time the home is foreclosed etc, the bar date to file claims is usually past. And what is the point of them filing a claim anyway. Perhaps where it might get sticky is if you have a second and they get nothing. They might try to file a secured claim but of course it would be unsecured and if not, you should make sure that it is paid as unsecured.

[howie]

I do have a second. The lawyer seemed to think I will not have to pay them anything as well. I will going into a 100% payback. I figure it best to get out of the house and start from scratch. I am little nervous about somehow having to pay something to the 2nd mortgage company.

[busbis]

we are surrendering 2 homes in our 13 case and we are at 100% payback. Our 341 is on 1/8 so I will keep all posted to let you know how it goes. Our atty didn't think their would be a problem in doing the 13. His explaination is you keep what you want and we have the right to surrender what we don't. We didn't qualify for a 7.

[howie]

busbis, please do keep us posted. I am just starting. I just completed all the paperwork and the credit counseling session. Of course my nerves are shot as I go through this. You always wonder if it is the right thing. I will be curious as to what you are told regarding the homes. I am worried about my 2nd mortgage. I hope my atty is correct that I won't have to pay anything. We have found another place to live on a long term lease purchase. If attorney is wrong, it will be tougher to make it.

[browndog]

busbis, please do keep us posted. I am just starting. I just completed all the paperwork and the credit counseling session. Of course my nerves are shot as I go through this. You always wonder if it is the right thing. I will be curious as to what you are told regarding the homes. I am worried about my 2nd mortgage. I hope my atty is correct that I won't have to pay anything. We have found another place to live on a long term lease purchase. If attorney is wrong, it will be tougher to make it.

If you are surrendering a home in Chapter 13, believe it or not, you can use the mortgage payment for that home as an expense on the means test, even though you are surrendering it.

This would likely reduce your payback amount.

[realestatebust]

I am very much over the means. My lawyer, who is supposed to be one of the best in southern Ohio, told us that in most cases when you surrender you will not have to pay anything on the home. I was just wondering if that was what anyone else had experienced. He said in over 8000 cases, he had only two that had to pay anything on a surrendered home.

Hi Howie
Im in southern ohio too, and this real estate market has killed me. I am currently starting to consult with atty's and wonder if you could recommend yours? Thanks

[howie]

His name is Richard West in Springboro, Ohio. He also has an office in Dayton. He really seems very good. Not judgemental at all either. Very easy to talk to.

[realestatebust]

thx

[southerncomfort]

I surrendered a rental home as part of my Ch.13. I still live in my main residence. The bank didn't get anything but a deed signed by myself and my husband giving it back to them. Interestingly, I had taken out a bridgle loan on the rental home in order to buy my current home. But, that didn't seem to have any effect on anything. I had put $10,000 down on the rental property which was bascially converted over to a down payment on my current residence.