hi i am facing foreclosure on a home in california. it is scheduled to sell tomorrow... i don't want to keep it but i am concerned about

1. tax repurcussions?
2. legal fees i may have to be responsible for?

so... i am also considering bankruptcy. i have gotten buried in debt because of tha house and i have approx. $25,000 (atleast) in credit card debt. if i do file for bankruptcy, i am concerned about:

1. what will happen to the house?
2. legal fees?
3. what will the re-payment be based on?
4. what if i lose my job afterwards?

at this point, my credit is already screwed because of the 7 months' worth of mortgage delinquencies... so that is not a factor in my decision.

help!

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You are going through a lot. I think you should speak to one of the bankruptcy attorney in your area. Find a reputed attorney in naca.net . Since the creditor is already in the process to foreclose your house, I think you should consider a chapter 13 plan by which you can save your house.

The repayment plan will be based according to your present financial situation. No one loses a job after filing bankruptcy. The United States Bankruptcy code prohibits discrimination by an employer just because you filed bankruptcy.

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I filed Chapter 13 Bankruptcy last year to save my house - it worked, but you need to think long and hard about the repercussions of filing bankruptcy. Consider the fact that although Chapter 13 will save your house, it will also place you in a long term payment plan, lasting 3-5 years, during which time, all of your "disposable" income (determined by a means test, not your definition of disposable income) will go to the plan payments. If you are certain that you can survive on what's left after the plan payments come out of your paycheck, and will be able to handle any emergencies or new debts that arise (those don't stop when you file!), then Chapter 13 is probably the best way to save your home.

I don't want to put a damper on the idea for you, but I want you to go into it informed about what will happen, and what effect it will have on your life.

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Yes, Suebee is right. You have to make a choice. Either you want to save your home and enter into a strict payment plan under chapter 13.

Or, you can get all your debts discharged by filing chapter 7. But remember, if you are thinking of doing this, your assets will be liquidated so that the creditors are paid through it.

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Just to add a note to orake's comment about Chapter 7, when they say your assets will be liquidated, that includes your home. All states have a certain percentage of the equity in your home that is exempt, but in certain cases, filing Chapter 7 can cause you to lose your home. Be careful.

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Thanks Suebee

I found the California legislative website having more information on the foreclosure laws.

http://www.leginfo.ca.gov/

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Great info, orake, thanks for posting it!

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what happens to a 2nd mortgage in the bankruptcy (Chptr 7) when you affirm iwth the 1st mortgage but not the 2nd?

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You still have to pay the second eventually because it is secured by the home. The lien will always remain on property and interest will continue to be charged.

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