Chap 7 two mortgages California

[ReK]

I am upside down in equity. I have two mortgages, the first 270k and the second, 80 k. They are refinances. The homes value is not any more than 270k if that much. I really don't want to keep the house. It is the payments that are killing us, not the credit cards. Can the mortgages be discharged? If so, do I risk a 1099 on the value after the property is sold by the trustee?

What are the risks or ramifications of this?

Thanks

[JRScott]

You can surrender property in a bk. However generally they will not allow you to use the expenses of that property to fill out your forms.

If you want to let go of the home, have you tried a short sale?

[ReK]

Well, we are not having any cooperation with our lenders. They are not replying to our requests, basically stonewalling us or offering very little. I don't have a lot of options except foreclosure and if I do that, then we are going to have a real big tax problem.

Thanks for your reply. We have a meeting next week with an attorney.

[ReK]

additional

I should have mentioned that the house is on the market but in our part of the state, houses are just not moving. We haven't even had anyone look at it yet.