Ch 7 letting home go in NC

[stressedNC]

We are getting ready to file bankruptcy our date to file is 7/15. In the past couple of weeks we decided we need to let the house go. When we filled out the 5000 papers for the lawyer we intended on keeping the house and listed that we planned to reaffirm. We called our lawyers office and told them that we were considering letting it go and they said we just have to tell them when we come in to file. Does that sound right?
We are in NC can someone walk me through what will happen with the house? We have not been late on a single payment but our July payment is due the day before we file. How long will we have to get out? Will they tell us or can the just show up and change the locks after they get the stay lifted?
Thanks
Lauren

[justbroke]

Yes, just tell your lawyer when you go to sign yoru papers. They'll change the Statement of Intentions to reflect that you're surrendering the home. You could, always do a ride-through by continuing to keep on-time with your payments, and then walk when you're done.

We are in NC can someone walk me through what will happen with the house? We have not been late on a single payment but our July payment is due the day before we file. How long will we have to get out? Will they tell us or can the just show up and change the locks after they get the stay lifted?

There is a process that has to be followed. If you list your intention to surrender in your Bankruptcy, then the lender will file for Relief from the Automatic Stay. About 21 days later, and if it's uncontested, the lender will receive that relief. However, they can't just foreclose. The problem is, that you are current. Since you are current, the lender can't foreclose on the home because there is no default on the Mortgage/Note.

The lender would then follow the normal foreclosure process. That is, that after 90 edays, the lender will mail you a Notice of Default (NOD). in that NOD will be a date to cure and an amount. If you don't pay by that Date, then lender may then "accelerate" the note. So, once that date passes, then the lender will hire a Trustee (a law firm) to proceed with a non-judicial sale. That Trustee will send you (serve you) with a notice to appear before the Clerk of the Circuit Court (in North Carolina) where you eitehr answer to the lawsuit. The lawsuit is basically really simple and is actually just permission for them to exercise their power of sale clause included in the Deed of Trust. Once they have permission of the Court, they have to follow the rules for non-judicial sales in North Carolina. That means, the date will probably be at least 60 days in the future of you receiving the first notice. You can delay some by answering and asking for an extension of time to answer.

All in all, from the time of filing, I'd say you have 10 random days, plus 21 days for the automatic stay. Then you actually have to default for 90 days, so add that too. Then you have to be served with the power of sale lawsuit, wait the 20 days, and then wait 30 more days for a sale to be scheduled. I'd say you have about 180 days from filing before you'll be out of there.

That's just my estimate.

Now, for the real deal. The lender may never even foreclose, even though they line up all their ducks. They will most certainly go through the motion of getting the relief from Stay, then waiting on your default, then pursuing their power of sale rights in local court. Now, the interesting part is... they'll probably postpone the sale over and over and over and over again! I think you have at least 180 days from filing... and more if the delay.

More than likely, they'll keep trying to offer you some "deal" to stay (but it probably won't be "that" good of a deal, but you never know).

Remember, and I'll repeat this for everyone. You own your home, the bank does not. They cannot "take" it without going through the proper process (foreclosure through judicial or non-judicial means). North Carolina is primarily a non-judicial foreclosure State. The only way the Bank will change your locks BEFORE they actual own it or it's sold at the Sheriff's Sale, is if you abandon the home. (If you look carefully at your Mortgage/Note you'll see a provision which allows them to do this to "secure" their interest in the property, should you abandon it. This is no different from their ability to purchase insurance, should you let your policy lapse, to protect their interests.)

Hope that helps.

[casdem1]

Still Here

We filed chapter 13 in June of 08. We were 3 months behind on our mortgage payment. Due to medical reasons, we converted from a 13 to a chapter 7 in September of 08. The two payments made to the chapter 13 trustee were returned to us - no payments were made to creditors -including mtg. We honestly told the chapter 7 judge that we wanted to keep the house and were trying to work out a modification with the lender (Beneficial). Our chapter 7 was discharged in Feb 09 and we have NEVER been able to speak with anyone at Beneficial. We did not reaffirm house. At this point we have made the decision to walk away. However, we are going to stay in the house until foreclosure and save as much money as possible. I monitor the court filings online and the sheriff sales, but so far nothing.

I'm not sure if our situation is unusual or not. It certainly seems like it is taking a long time for them to foreclose.

[AngelinaCatHub]

We filed chapter 13 in June of 08. We were 3 months behind on our mortgage payment. Due to medical reasons, we converted from a 13 to a chapter 7 in September of 08. The two payments made to the chapter 13 trustee were returned to us - no payments were made to creditors -including mtg. We honestly told the chapter 7 judge that we wanted to keep the house and were trying to work out a modification with the lender (Beneficial). Our chapter 7 was discharged in Feb 09 and we have NEVER been able to speak with anyone at Beneficial. We did not reaffirm house. At this point we have made the decision to walk away. However, we are going to stay in the house until foreclosure and save as much money as possible. I monitor the court filings online and the sheriff sales, but so far nothing.

I'm not sure if our situation is unusual or not. It certainly seems like it is taking a long time for them to foreclose.

Well, since 'Bammy's stimulus to all the banks, the banks still do not have it together. They still do not loan money out, and the vast amount of foreclosures are probably the reason for such a delay. Use the time and save. 'Hub