Expert: Terry Leeders - 4/4/2007

Question
My home is in forclosure and my house is scheduled to be auctioned off in 6 days. Should I file Chapter 13? Do I have enough time to file? I owe: 110,000 1st mortgage, 36,000 equity line of credit. I have a credit card balance of 6,000. My 1st and 2nd mortgage pmts are 11 mts behind and I am, and have been, current on my credit card ( card has a co-signer). Due to layoff, I have fallen behind on my mortage and have since entered into a new profession. My delima is that I am still in training for this new profession and am only making around 200.00 per week. I do however, have a significant other living in the hoome who brings home about 420.00 per week. Do I want to keep the home? Yes, but not if after I finish the Trustee agreement payments, I will still have a mortgage payment of 1,000 per month. I would not be opposed to loosing the home, but I am looking for my best option to not completely ruin my credit. PLEASE HELP!!!!


Answer
Crystal,
You need to speak to an attorney immediately.  A Chapter 13 plan can be set up to stop the foreclosure, but it must be filed before the sale date.  There is a counseling class that you need to complete before filing as well.  An attorney can design a case, where the first court payment wouldn't be due for 30days.  Hopefully your income will be up to full steam at that point.  If you are not interested in saving the home, perhaps a chapter 7 can be filed to wipe out all of your debt, and help you get a complete fresh start.  If you live in Illinois, I'll be happy to discuss the matter with you.  Time is of the essence though.
Thanks
Terry