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Will Declaring Bankrptcy Interrupt Foreclosure Conference?

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    Will Declaring Bankrptcy Interrupt Foreclosure Conference?

    The Bank turned down our loan modification, they decided to foreclose on our property of 26 years. My husband and I are both over fifty right now. I went though sheer hell with the Bank to get our first loan modification, it was being paid on time then out of blues, he got no work for two months.

    He has a very passive aggressive personality, unable to accept that he did not turn out to be the success he wanted to be so he directs his anger towards me. He once owned his own contracting business, he worked with a building firm, consisting of a architect, a builder and a guy who brought in the business.

    He never paid any attention to me when I told him he was limiting himself by only working with these guys that he needed to get into contact with other builders and widen his options and stop being so dependent on these guys for regular work. Just as I predicted they broke up, and he was left on his own. His workers left him and he was deep in debt.

    Fast forward to now, the bank only decided to take our request for a second mortgage because the State we live in has a Foreclosure Conference Law in which the Bank and the home-owners are required to work out a settlement before the bank forecloses on the house. The Bank turned down our second modification application stating that they did not see any "significant improvement in his monetary situation". Meaning they want us to have at least $2,000.00 on hand after business and home expenses are deducted.

    Right now he has six judgements against him, our banks accounts have been frozen and once again like back in 2009 he does not want to declare bankruptcy. He sees it as a personal failure. I had to go to the lawyer by myself he refused to go. The lawyer said we might qualify for Chapter 7, since we are neck deep in debt.

    I have a big problem. At the second Foreclosure Conference he told the referee and the Bank's lawyers that things were looking up, that he expected things to turn around in a couple of months, so they decided to give him extra time to show this. This man insists on talking about the 'next big job' that he expects.

    I want to file bankruptcy but I am afraid that the bank will withdraw their offer of letting him have a couple of months to catch up and go for immediate foreclosure. Would someone, anyone, please, please tell me if my filing bankruptcy would hurt our chances of keeping our house?

    It is an old house, needing lots of repairs to the roof and many other parts, but it is where I raised my kids and I am deeply attached to it and would like to spend my remaining years there. The rent where we live is over the top. There is no such thing as affordable apartments or houses for rent. The possibility of moving out of State is not an option.

    #2
    The bankruptcy creates something known as the automatic stay which prevents creditors from using or continuing any method to "collect" a debt. A creditor can certainly petition the bankruptcy court to ask for relief form the automatic stay (RFS) so that they can continue their collection. Most banks would file an RFS within 30-60 days of your filing the bankruptcy in order to preserve their foreclosure rights.

    If you are going for a Chapter 13, this is a totally different situation than a Chapter 7. If you provide for curing the arrears in your Chapter 13 Plan of Reorganization, then the bank would not be allowed relief from the stay and must adhere to the "confirmed" Plan.

    Please learn to distance yourself from that house. While you have made it your "home", you can always move your home and your family. If the home is not financially worth it, you should, with all due haste, allow it to be surrendered or foreclosed upon so that you can move forwards, not backwards. If the home is the true financial burden in your life, then this makes a whole lot more sense. It is and always should be purely a financial decision when it comes to a house (or other property).

    Having wrote that, if the home is livable and you would certainly not be set back by any significant repairs, then saving the home could be the option for you. However, it may be that you need a Chapter 13, not a Chapter 7, to get from under the debt and restore your "home".
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog

    Any advice provided is not legal advice, but simply the musings of a fellow bankrupt.

    Comment


      #3
      Of course, to file a 13 you'll need a reliable source of income to fund the plan.

      Comment


        #4
        Originally posted by Greenrose View Post
        Right now he has six judgements against him, our banks accounts have been frozen and once again like back in 2009 he does not want to declare bankruptcy. He sees it as a personal failure. I had to go to the lawyer by myself he refused to go. The lawyer said we might qualify for Chapter 7, since we are neck deep in debt.
        This may be just the way I am reading the above from your post but did you file and discharge a bankruptcy in 2009?? If you did, did you file a 7 or a 13?


        For what it is worth: A house is just shelter. Home is where your family is.
        ~~ Filed Over Median Income Chapter 7: 12/17/2010 ~~ 341 Held: 1/12/2011 ~~ Discharged: 03/16/2011 ~~
        Not an attorney - just an opinionated woman.

        Comment


          #5
          Originally posted by ValleYum View Post
          This may be just the way I am reading the above from your post but did you file and discharge a bankruptcy in 2009?? If you did, did you file a 7 or a 13?


          For what it is worth: A house is just shelter. Home is where your family is.

          In 2009 he agreed that we should file Chapter 7 bankruptcy, we went to the lawyer, paid down on the lawyer's fees, did bankruptcy counseling and then when the time came to give the lawyer the go ahead to start the proceedings, he said he no longer wanted to declare bankruptcy and told to tell the lawyer he had changed his mind.

          Comment

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