This is a complicated situation. I was in the middle of a short sale process, when the morgage loan servicing company just posted on my door a notice of auction, to take place shortly. I was surprised.. Never received a notice of default in the last 365 days. Since there care offers in the pipeline I need time...chapter 13 will provide time. Can the payment plan to propose, be a short sale in itself? Since I do not think i can be realistic otherwise?. Meaning my backlog debt increased by some magic of the lender is impossible to pay in my current situation. Only a short sale will leave me clean and free of this debt.
Robert W GambrellChapter 13 Bankruptcy AttorneyOxford, MS ·
The filing of a chapter 13 will stop the foreclosure and buy you some more time, but you cannot force a mortgage holder to accept a short sale in chapter 13 or chapter 7.
Obviously from my location, I am not licensed in California, but my understanding in most instances the mortgage holder cannot collect the deficiency. Thus, the only reason you need the foreclosure is to keep a foreclosure off of your credit report. If you file a bankruptcy to buy more time and the mortgage holder seeks and is granted a lift of the automatic stay and then forecloses, you have both a foreclosure and a bankruptcy on your credit report.
You need to speak with an attorney. You my not be responsible for the balance after foreclosure. If you will be responsible for a deficiency, a Chapter 7 MAY be quicker, less expensive and have some tax advantages. Please speak with an experienced bankruptcy attorney in your area.
Rob
The best and most useful advice anyone will give you is to get the assistance of a lawyer. Otherwise, you are almost guaranteed to get your case dismissed.
David Patrick FarrellBankruptcy AttorneyLong Beach, CA ·
Like other counsel said, a chapter 13 will buy you some time, but the court won't confirm your plan, and I suspect the lenders will get permission from the court to foreclose since you cannot propose a feasible plan to cure the arrears and save the property. Chapter 7 may be a better option for you. Hire a lawyer! Filing bankruptcy without a lawyer is really foolish. Especially since you can get really good advice and representation for a relatively small amount of money. Bankruptcy can blow up in your face if you don't know what you're doing.
You cannot sell with a short sale on your own. Both you and the mortgage company have to agree to do so, and both have to agree to accept whatever particular offer you want to accept. It's like the home has two owners who must agree. And a short sale DOES NOT LEAVE YOU FREE AND CLEAR OF THE DEBT unless the contract you sign with the bank says it does.
If te lender forecloses, what is your loss? Non judicial foreclosure in California means they cannot go after your for the difference between the sale price and the loan amount. Also, many (most?) lenders will bid the loan amount hoping someone else will overbid. It also means that the amount that would be on the 1099c is zero, because no debt was forgiven Not true with a short sale.
Do you have other debts, so that a BK will give you a fresh start?
Finad and talk to a bankruptcy attorney before filing a bankruptcy.
