My divorce papers have been signed by my ex and myself and I waiting for them to be signed by the judge and returned. The home we shared is in foreclosure and up for sale. I am debating whether to let it foreclose or file bankruptcy first. It has been for sale for 4 months now and I've given up hope, they will foreclose on it in June. I have credit card debt, etc. I could include in the bankruptcy due to the divorce. Which is worse for your credit rating a foreclosure or a bankruptcy? I do not want the house so it will either be sold or taken.

A bankruptcy or foreclosure will do serious damage to your credit. The BK will remain for 10 years, and the foreclosure for 7. To get a prime mortgage in the future, the usual waiting period is 2 years for a BK, and 3 years for a foreclosure. Since there were major changes in the BK law last year, you shoud check with a BK attorney and see how they affect you. You should discuss this matter with your soon to be ex, as it may be cheaper for you both to file BK jointly (if it is not too late for that). Good luck.

You do reaise that the foreclosure does not do away with the debt. After the property is sold at foreclosure, (it almost never sells for enough to cover the entire debt) so you will still owe money after the foreclosure.

You need to talk to an attorney before you do any of it. It is possible you may need to file bankruptcy after the foreclosure.

If the mortgage note is secured by a Deed of Trust, there should be no provision for a deficiency balance due from the Trustor (borrower), unless the lender chooses to proceed with a judicial foreclosure. Many states have switched to the Deed of Trust because it offers many benefits to both the borrower and the lender.

****I am not an attorney. This should not be construed as legal advice.****

Do you have any time after the foreclosure to try to sell the home?

Is anyone buying anything in your market?

Is the home reasonably priced? My definition of "reasonably priced" means, will it sell at that price in this market? In many areas of the country, if the buyer doesn't feel like he's stealing the property, he won't even make an offer. If that's the case in your market, what's the right price?

If you still have enough time to get an offer and get it closed before they take it, then keep slashing the price until you get an offer that sticks.

Also, you may need a different agent. Does your agent know that you're in foreclosure? What qualifies this person as an expert in handling foreclosure property? 99.5% of the agents in any community are not properly qualified to handle this type of situation. [Of course, they will argue otherwise.]

Are you thinking about filing Chapter 7 or 13? Would you qualify? Do you have a significant amount of debt... enough to justify the price you'll pay by filing? In many cases, the answer is no... but there's not nearly enough information here to assess that.

Oh... BTW... best of luck in finding an GOOD bankruptcy attorney. Roll up your sleeves on that one.


Follow some of the above suggestions and you'll have a lot more information so you can make an INFORMED decision about what to do next.

Just because you've given up hope doesn't mean that you don't have any.

I have recently lost my job and I am unable to pay my mortgage my mortgage company has agreed to a short sell I need to know how this effects my credit, the house is now listed at a reduced price in the meantime I am for payments behind, need to know if I come up with two payment will this benfit me to send them to the mortgage company or is it to late has the late payment already ruined my good credit score I been givern an opportunity to start a new job in another state in may If I can somehow manage to catch up on my payments until may but the house still has'nt sold I may have to let it go anyway I can't afford not to take the job I have a family to support what should I DO

If you file the BK BEFORE the foreclosure proceeding begin then the house does not go on your record as a foreclosure which could mean huge things in the future when you get ready to buy a house!! If the foreclosure starts prior to the BK then it will always remain on your credit report that way and it will be very difficult to get financing in the future. BK does not affect your ability to get financing as much as a foreclosure.

As far as the decificiency balance, it doesn't matter when you file, it will be included in the bK.

Now, as far as the credit card debt. Be very careful with this. If this was given to you in the divorce decree as your debt to pay, then it is very likely that you will NOT be able to include this in any BK... now or later. Once credit card debt is assigned in a divorce decree and your file BK it could potentially go back onto the spouse which would be in violcation of the decree. So check the community property laws of your state and also check to see if your spouse was a co-signer on any of that debt. If any of that debt would go back to her if you file then you won't be able to file on that debt.

Good luck and I really hope things get better for you. I know divorce and financial problems are very difficult to weather.

God bless!