? About Chpt 7 & Foreclosure
Husband and I have 2 mortages on a home valued at $190,000. Selling it isn't an option as house's just aren't going right now in our area for what we would need to break even on it. Along with $12,000 in CC debt and 2 auto loans, it's just not possible to make it. (lay off's & restructuring" after 11 yrs of employment with compnay) My questions: If we foreclose on the home and it sells for LESS than the loan amounts, are we responsible for the difference?? I figure we probably are but want to double check. And if we are, can we include the difference in a Chpt 7 bankruptcy. Also, we also have 2 auto's that we need to let go as voluntary repossessions. Once the creditor sells them are we responsible for the difference in price vs. loan with a chpt 7, and if so can that amount also be included in a chpt 7 ? How long does an official foreclusure take? Should we file BEFORE or AFTER the foreclosure/reposessions?
Of course, you should talk to a few bankruptcy attorneys in your area. Many will give you a free inital consultation. Even if bankruptcy might be in your future, there are questions about when would be the best time for you to file -- now or later. Sometimes, it pays to wait. On the other hand, there are potential bankruptcy law changes in the wind. So, see a bankruptcy attorney ASAP because he/she can give you a lot of good information in one brief visit. As far as the balance still due after a foreclosure or repossession, yes, they become unsecured debts that you owe and that can be included in your bankruptcy. I am not a lawyer, so the above is just what I think from reading etc. I don't know whether MN law allows the collection of a deficiency judgment (the difference between what a property sells for at foreclosure [plus expenses] and what is owed). I can tell you that it is discharged in a Chapter 7, as is any deficiency resulting from a voluntary repossession.
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