Bankruptcy Law/bankruptcy and foreclosure
I am writing to gain a better understanding of bankruptcy and if it might be a good option for me (by "good" i mean "least bad"!) I live in NC and bought my townhome in 2006 and looking back, I shouldnt have bought my place bc it was clear I couldnt afford it. And I think it was clear to Wells Fargo and my mortgage broker too. The terms of mortage are terrible.
In 2010, I was laid off from a really good job and it took 2 years of part-time and temp work before I found another FT job...one that pays about 20k less than the one I lost. I have applied for a loan modifcation w my new mort company (Wells Fargo sold it after signing the deal; then the next company sold it 6 weeks later). My mort company told me my mortgage is not HAMP eligible (although it was when it was w Wells Fargo...) and that they only modify to a 7% interest rate.
I have an underwater house, about 40k in student loans, a few small credit cards I stopped paying when unemployed and a car loan. I don't see a way out of this.
I dont understand bankruptcy. Can I file if I have a job? Do I lose everything if i file- house, car etc? Is it better to file bankruptcy or to lose my house in foreclosure? I've heard that you cant get any credit for 7 years after bankruptcy- does that mean when it's time for a new car, I'd have to pay everything out of pocket?
Thanks so much for your help!!
ANSWER: Hello Melissa:
I will first answer your questions directly after retyping them here.
dont understand bankruptcy. Can I file if I have a job?
Yes - Most of my bankruptcy clients have a job that decide to file.
Do I lose everything if i file- house, car etc?
No - In fact, in almost every consumer bankruptcy, the debtor does not lose anything. Whether you would lose anything or not, including your house, etc., depends on some facts that you don't state in your question.
Is it better to file bankruptcy or to lose my house in foreclosure?
To answer that also depends on some facts you don't state in your question. In your situation bankruptcy is usually better for several reasons, but again, I won't know for sure unless we can talk about this further.
I've heard that you cant get any credit for 7 years after bankruptcy- does that mean when it's time for a new car, I'd have to pay everything out of pocket?
First of all, the bk stays on your credit for ten, not seven years. However, the idea that you can't buy anything on credit for that time period is simply not true. For most filing bankruptcy is a good chance to make a new start.
Melissa, I would ask that you call me on the phone to talk about this further. I will not charge you anything to talk on he phone and you can call me directly at the number listed below. I can then explain the whole process and explain more on the specific questions your raised. It is easier for me to talk on the phone than to wear my fingers out typing.
I look forward to hearing from you.
Jack Hall J.D.
Hall Bankruptcy Services
---------- FOLLOW-UP ----------
QUESTION: Thank you so much for the offer to help. Would it be ok to call you this evening after work? I don't want to call too late- I could also call tomorrow afternoon. Let me know what works best for you. Again, thank you!
Hi Melissa: I am just now reading your follow up message on Saturday the 4th. You can call me anytime you like. I gave you my cell phone so you could call me anytime. As I said before, I will not charge you just to talk on the phone. Jack Hall