Bankruptcy or Foreclosure

[mustang637]

I have read on here that people think that filing bankruptcy is far worse than being foreclosed on, can someone explain why?

Here is my situation:

I have purchased 11 investment properties and owner financed them all to the same corporation who has stopped paying me. These are the only debts that I am behind on, I am current on my house, my cars and any credit card debt I may have. The only reason I am looking at filing bankruptcy is because I can't afford the $22k in monthly payments on these 11 investment properties. I don't want 11 foreclosures on my credit, I figure one chap. 7 is better.

If I am wrong please explain.

Thanks

[HHM]

I think there is some disagreement on this forum about your premise that Bankruptcy is far worse than foreclosure.

It depends on the context, for most people the concern about foreclosure relates to the ability to buy a house in the future. In that context, I am of the opinion that having a foreclosure on your credit report is worse than a bankruptcy as the foreclosure relates directly to your worthiness as a potentional mortgage candidate.

However, for overall credit worthiness, a bankruptcy is probably only slightly worse than a foreclosure.

[mustang637]

That's cool. I'm not planning on losing my house just giving up the 11 investment properties. My bankruptcy attorney told me that if I pay my mortgage and car notes on time for 2 years after the discharge and there are no other problems then my credit score should be close to where it is now which is right around 700.

[HHM]

That's cool. I'm not planning on losing my house just giving up the 11 investment properties. My bankruptcy attorney told me that if I pay my mortgage and car notes on time for 2 years after the discharge and there are no other problems then my credit score should be close to where it is now which is right around 700.

Yeah, that sounds about right. I think in your case, a bankruptcy would be better than 11 foreclosures.