Expert: Terry Leeders - 1/4/2008

Question
When filing 7 including mortgages would foreclosure be listed on the credit report however long it take for a home to foreclose after 7 been discharged, or will it show at the same time chapter 7 is discharged?

What's the difference in including your home in chapter 7 at the time of filing and just letting go in foreclosure on it's own?  The impact on credit?

Answer
If you don't file bankruptcy, the mortgage company can collect any mortgage deficiency balance from you.  The bankruptcy discharges the debt to the mortgage company, while the foreclosure will transfer the title back to the lender.  Foreclosures take 6-9 months.  If the bankruptcy is filed first, it trumps the foreclosure, and you should be able to start re-establishing credit 90 days later.