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Chapter 13 question

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tammymc

Junior Member
What is the name of your state? Arkansas

My husband and I filed Ch. 13 two years ago. He had lost his job, we got behind on the mortgage and the mortgage company refused to work with us, slapping huge fees on to our balance where we could never catch up. We had two days before they were going to foreclose on our house so we had no choice but to file Ch. 13.

We have been making our payments for two years now, but now we are wanting to move. We've tried to sell the house and can't (it's a rural area). My mom is ill and we need to move to be closer to her. (We would have to rent a house and would not be able to continue the trustee payments.) What are our options?

Are we allowed to surrender the house and if so would we lose our cars?

If we default on our payments to the trustee and they dismiss our case, what happens?

If we surrender the house, I have heard that they will auction it off to the highest bidder. If the highest bidder bids less than what we owe, do we have to pay the difference, and if so, how does that work? Do we have an extended period of time to pay this or do they require the lump sum to be paid at once?

I have read about converting to Ch. 7 and I'm confused about this. What would happen in our situation if we were to convert to Ch. 7? :confused:
 


bigun

Senior Member
Talk to your lawyer. A conversion to a chapter 7 will wipe out all of your creditors and you'll have no liability for anything.
Do you have any equity in your home? What are the cars worth?
 

tammymc

Junior Member
State: Arkansas

Not much equity in the home. Not sure what the cars are worth but a guess would be $10,000 and $5,000. We really would like to keep them. We were not behind on our payments on those at the time that we filed Bankruptcy, they just told us we needed to file on everything. I was hoping I could find out something here as we can't ever get straight answers from our lawyer...
 

itsmeDAD

Junior Member
recent converts

My wife and I are recent converts... from chapter 7 to 13. If you convert to a chapter 7 you will walk away free from your debt I believe. Keep in mind yur creditors wont veiw you as 1 bankruptsy, it will be two in a matter of two years. I was told by a creditor that this is a bone crusher when it comes to interest rates even 5 years down the road. Take some lint put it the back of the dryer and burn the place down. of course I'm only kidding but remember you'll pay as much as three times the interest rate if you file 2 times. at least in my experience its been that way. good luck.


Dad

I am not a lawyer, consult your lawyer and get a second opinion.
 

tammymc

Junior Member
We borrowed $16K for one car and it is now probably worth $10 K (Guess--Maybe less-It has been wrecked.). We borrowed $11 K and it is probably worth $5 K or less (another guess). I really have no idea what our balances are because we never get a breakdown of where are payments are actually going. So we do have some equity in the cars. We borrowed $82 K for the house ( 4 or 5 years ago) and the mortgage company lawyer told our lawyer that payoff if someone bought the house would be amost $87 K after all the penalties and fees, etc. that they would tack on to it. :mad: :eek:
 

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