Expert: Terry Leeders - 12/28/2007

Question
Please let me start by saying thank you for your time in helping me with my question.  If I file a chapter 7, I know I cannot keep my home (due to behind in payments) and have reached the conclusion that I can't afford to make the repayment plan in a chapter 13, will the foreclosure proceedings stop for a few months?  I have not been given any foreclosure papers as of yet, but I expect them.  My question is, if I file and surrender my home (which has equity but I haven't been able to sell) can I stay in my home until after the discharge  or sale?  Also, if I file the chapter 7 (I did the means test) if the trustee sells my home for more than the mortgage do I get the overage or pay's my debts?  Also, does my mortgage company get the home back immediately, or will they file foreclosure proceedings to zip along as soon as I file?


Answer
Foreclosures will take about 6-9months, depending on where you live and how fast your lender moves.  You will discharge any balance left thru the Chapter 7.  You can stay in the home, rent free until the sale occurs.  You would be entitled to recoup your state exemption amount for homestead, and if there are any excess funds after all debts and assoc. costs, you would get the remainder.