This article is a resolved question from Yahoo! answers: Foreclosure Bankruptcy?
Can I file bankruptcy if my mortgage is more than I bring home? My home is in foreclosure; however, my associating have file foreclosure on my home not my mortgage company. My mortgage is 2000 and now I am 6000 behind on my association fees. How would that work out if I file bankruptcy? Right now my income is 2500 take home, I have a car payment of 460 also. Will the bankruptcy court find a way to reduce my bills?
Best Answer – Chosen by Voters
I am assuming you mean the HOA (Home Owners Assoc) when you’re talking about whose filed FC on your property. It is within their rights to put a lien against the title if you fall past due and FC if you do not bring the account current and keep it there. If they FC (i.e. foreclose) on you, they will force the 1st into FC as well. When the foreclosure is completed the collateral (house) will be owned by the HOA. They will pay the first off whatever they can – if there is anything still owing, it will show as a charge off on your credit.
If/when the HOA forecloses on you they will have the ability to change the locks on the home and anything inside the house (unless they put it in the front yard before changing the lock) will become property of the HOA. You’re going to want to talk to a foreclosure attorney to find out how long between auction and eviction. You’ll want to inquire about redemption as well.
You should probably see if you can bring the HOA current. Suggestions to do that, borrow from friends or family, sell that car (which you can’t afford). If you could afford it there wouldn’t be any problems with that HOA – right?? If you haven’t asked for help yet, you need to get past your pride and ask – this is where you have spent holidays, had birthdays, if you have kids this is where they live – Get Past Your Pride….
I will tell you that the workouts available by the Servicer requires that you be able to afford your house payment .. by breaking even. If you have a deficit in income that is say — $200 or greater it’s unlikely you’re going to be able to qualify for any assistance (hence the .. get rid of the car). When and if you have to go to family to ask for money to get the fees caught up so you don’t lose the house – you might want to put forth you’re already making changes with spending by cutting back on things that you can’t afford.
Once you get your financial affairs so they’re not upside down or in the negative – call your servicer explain you’re in a financial hardship – be prepared to go over your income and expenses.. if you have a surplus or even a little bit of a deficit, you may qualify for a workout meaning a Loan Modification. You can go to www.hud.gov to read about whats out there now and to see if you may be a candidate.
Will BK Help? No.. the HOA will pull themselves out with the blessing of the court and foreclose anyway. The correct term is “Motion for Relief” which all creditors are entitled to do if they want/need to. BK will protect you from some things, however the creditors have rights too.
Good Luck with Everything. You have some huge decisions you need to make.
Source(s):
Loss Mitigation Supervisor
