Buying/Selling Home-Questions

[CoachK]

I was discharged Ch.7 in Feb. 2006. The questions I have are as follows:

Is it a problem to sell my home so soon? I will probably net around 25K or so after the sell. I did not reaffirm, but I have been current on my mortgage payments.


Also, I will want to purchase a new home in the 200K range. My income is around 100K. I know that I will get a terrible interest rate if I even get approved. What if I get a cosigner with outstanding credit? Will this help to get me a better rate?

Thanks in advance.

[SinkingFast]

Not sure if it was the same under Old Law as it is under New Law, but,........

The Trustee can sieze any windfalls you may come into within 180 days of close of your BK.

In your case, you're talking a house where you probably applied a Homestead Exemption. Unless you live in a State where you applied enough Exemption that would allow you to cover your anticipated proceeds from the sale, you're best off to wait a bit longer. Maybe go on the market sometime in June and time the closing on the sale of your current house to be beyond the 180 day time frame.

Just a guess here, but the Court probably won't consider selling costs of Realtor and doc fees in there. The Trustee would probably just see sale price minus principal balance and figure up the difference. If that's the case, there's very few States that would have a Homestead Exemption big enough to cover the sale of your house.

Definitely ask your attny just to be sure. I know we were told windfalls within 180 days after close. That applied to inheritances, the lottery, etc.

[Pumpkin729]

SinkingFast...

Does the above statement also apply to a chapter 13?

Thanks

[MTG_BANKER_OH]

I was discharged Ch.7 in Feb. 2006. The questions I have are as follows:

Is it a problem to sell my home so soon? I will probably net around 25K or so after the sell. I did not reaffirm, but I have been current on my mortgage payments.


Also, I will want to purchase a new home in the 200K range. My income is around 100K. I know that I will get a terrible interest rate if I even get approved. What if I get a cosigner with outstanding credit? Will this help to get me a better rate?

Thanks in advance.

Unfortunately a cosigner will not help you out in your situation. It can help in certain circumstances but most loan programs that will allow a cosigner or a non occupying co borrower you will need to be 2 years out of the BK. You cna still get financing though for anew home. You will need to see where your scores are to determine eligibility and you should also reestablish credit as soon as possible to get your scores up.

[SinkingFast]

SinkingFast...

Does the above statement also apply to a chapter 13?

Thanks

You can't do anything inside Ch 13 without Trustee approval. You can only take on 2 forms of debt. Home mortgage and auto loan. But you have to be in your plan at least one year, and have to seek Trustee approval first.

If you have some circumstance arise while you're in the plan, like job change that requires you to move, you'll have to inform the Trustee of the need for change ASAP. That you need to sell your house and move to a new location.

The entire time you're in a Ch 13 plan, the BK Court has controlling interest over your estate.