QUESTION

We are currently going through Chapter 7 Bankrpt. We have elected not to save our home, 110k under morgage amount.

Asked on Dec 20th, 2011 on Real Estate - Florida
More details to this question:
We can not move until July. Last morgage payment was in May 2011, Bank of America/Fannie Mae. We asked for help prior to our last payment, and were denied unless we placed additional monies down, we placed a $88k down payment on this house in May ''07 and will not throw any more good money after bad. Are we better served to go into foreclosure or Deed-In-Lieu as it gets closer to our moving date? Our house is in Florida, my husbands job is in Georgia where we plan on relocating in July.
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1 ANSWER

Foreclosure/short sale/bankruptcy strategies for your situation are difficult and you should probably have an attorney advising you through this process. Depending on your specific facts and when you filed for bankruptcy and whether the automatic stay has been listed on any foreclosure action against you, you may be able to stay in your house until July or you may be dispossessed prior to that. Some attorneys would advise in the situation to try to fight any foreclosure action so that you can remain in your property as long as possible. In addition, there may be some valid defenses you would have against your lender that could legitimately delay the foreclosure action and possibly even reduce the amount of any deficiency judgment (although if you are going through bankruptcy it is possible that no deficiency judgment would survive the bankruptcy).  If you can remain in the property until July you can then propose a deed in lieu transaction with the lender which I am sure they would willingly accept given the background of your bankruptcy filing. Please also note that there are some government programs that are available through lenders that could provide some relocation funding for you ("cash for keys" and other programs). That is another reason to contact an attorney in your area that deals with short sales and foreclosures.
Answered on Dec 27th, 2011 at 8:08 AM

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