Renting house during active CH13

[AnnieG]

Hello all-
My question is this: if we are 6-months into a CH13, and need to relocate, could we find a rentor for our currently mortgaged house and then rent at the new location until the CH13 is discharged? Not sure if this is a feasible or really stupid idea!....but from what I've read, it seems a bad idea to sell a house while in active CH13, since any equity would be gobbled up by the trustee. We don't have a great deal of equity, probably have about $8-10K. Also, would it be extremely hard to rent a house during active CH13? Any thoughts?

[JoyH]

Hello all-
My question is this: if we are 6-months into a CH13, and need to relocate, could we find a rentor for our currently mortgaged house and then rent at the new location until the CH13 is discharged? Not sure if this is a feasible or really stupid idea!....but from what I've read, it seems a bad idea to sell a house while in active CH13, since any equity would be gobbled up by the trustee. We don't have a great deal of equity, probably have about $8-10K. Also, would it be extremely hard to rent a house during active CH13? Any thoughts?

Hi Annie,

That is just what we did. Soon after filing CH 13, my husband was offered an excellent job in another state. After consulting with our attorney, we rented out our home. We are in the process of selling it now that we have received a discharge. On the plus side...the price of homes in our area has skyrocketed during the time it was rented out. The lawyer confirmed that any profit made will be ours to keep.

Do be careful though about who you're renting to. If they don't make timely rental payments causing you not to make timely mortgage payments, then this could obviously cause you to lose your house. It might not derail your whole Chapter 13 Plan though, if your payments to your mortgage company are outside of the Plan.

We also rented a home. My husband explained to the potential landlord about our bankruptcy before he did the credit check. Yes, we got the house and no, we've never been late ever on paying our rent.

Good luck!