Rental Property Cram Down

[UpsideDownMI]

I have a rental property that has been vacant since the end of January that I have been planning on just letting go. However, I recently got a CMA from a realtor which states that she believes the property would only sell for 12k in this market. The same realtor did a CMA for me 3 years ago for 50k, but I didn't list because I was greedy at the time and wanted to wait until I could get 60k. So I rented the house out at 550/month and here we are!

Now we get to the cram down. Even though I swore that I was done with the landlord business, I feel it would be foolish of me to ignore the opportunity that is presented here. My payment to cram this house down would be approximately $365 (3 year) or $232 (5 year). I am under the median so I could propose either plan length.

The question that I have with this option is do I have to have the house rented before I file bk or can I just list projected income on my schedule J and state my intention to rent the house out?

[frogger]

Even though I swore that I was done with the landlord business, I feel it would be foolish of me to ignore the opportunity...

Perhaps the foolish thing is forgetting why you swore off landlording. It's not getting any better out there....

[HHM]

What is the existing mortgage obligation?

In any event, you don't need to have it rented at time of filing, but the trustee is probably going to want to see a renter in there. Reason being, the money you are paying from your regular income to keep the rental is money (so the trustee would argue) that should go to your unsecured creditors. But, in any event, you should be fine.

[UpsideDownMI]

Thanks for the reply. The balance due on the mortgage is roughly 35k. What would be a good way to handle this if it was not rented prior to filing? I was thinking I could list my expenses on schedule J and add a provision in my plan that states that I will relinquish all rental income to the trustee. The other option is to project income on schedule I.

[UpsideDownMI]

Just a quick question about the cram down. I assume that if you cram down a secured loan, you do not have to pay any arrearages that may be due on that loan. Is this correct?