1st BK hearing Monday-want to sell & buy - Posted by Wanda

Posted by John Corey on March 28, 2006 at 03:16:29:

There must be more to this as it looks like you will end up settling with the creditors for 100% of what is owed. In some way no BK is needed.

See if you can work it out so that if you do settle for 100% the BK can be reversed and you no longer have it on your record. You maybe have already asked and there could be other reasons why you want to pay in full and carry a BK for the next 10 years on your credit file.

Do not worry about the prices in NC. They will be what they will be. If you know how to find bargains they will still be there in 6 months. The market might be active but we are not talking a mad rush given the doom and gloom in the press nationally. Focus on handling the details in CA and finding the job transfer you want.

Note that buying in NC will be an issue with a BK on your credit file. Be prepared for loan terms that might seem expensive, painful or otherwise not what you might expect if all your bills were paid in full.

John Corey

1st BK hearing Monday-want to sell & buy - Posted by Wanda

Posted by Wanda on March 25, 2006 at 06:54:33:

I found this site very helpful in answering different questions about real estate investing. However, my problem is that I have filed Ch 13 BK and have my first hearing on Monday. I own a home and have never refinanced or anything but I want to sell my home and relocate to NC and buy something there. I have to give up half my equity to my brother who hood winked me into putting him on my title as joint tenant but I should still walk away with about 100K after paying of my BK $46K. Will I have a problem getting financed if I want to buy something around $200K in NC?

Re: 1st BK hearing Monday-want to sell & buy - Posted by John Corey

Posted by John Corey on March 26, 2006 at 14:00:02:


Your situation is not clear.

You said you filed for BK. You have assets and indicate that you expect to pay 46K in debt. Is that all your debt or only a partial settlement?

If you are paying all the debt after the sale they potentially you do not need to be in BK. The court will oversee the sale or otherwise tell you what conditions apply. You will no longer be able to effect the sale on your own.

I am not a lawyer and you have not explained the full situation.

Assume that just about anyone who has had a BK can get financing after things have settled and they have turned around the situation. For some folks it is pretty quick and others seem to need more time before most lenders will work with them.

In almost all cases you will pay a price for having the BK in the past. That price could be something you pay for years to come (higher interest, more conditions, higher fees). The cost does tapper off as time passes. It will be something you have to report for approximately 10 years on all credit applications.

I am assuming you are working with a lawyer. The lawyer can explain part of this. Loan officers here can fill you in on the mortgage details. Other sources of credit will have their own criteria (credit card companies may force you to put cash on deposit before issuing a card, etc).

Assume the future is bright and you can certainly make things better over time. The BK will stay with you for a long time. If there was anyway to settle without a BK you may be better off. Each person’s situation is unique so check into this before deciding one way or the other.

John Corey

Re: 1st BK hearing Monday-want to sell & buy - Posted by John

Posted by John on March 25, 2006 at 20:05:28:

Once the BK is discharged You can get financed for a new property. There are a few lenders that will do this if you have a job and income history and FICO does not drop below 520? i think. The rates will not be pretty and you will need 20-25% down

Re: 1st BK hearing Monday-want to sell & buy - Posted by Wanda

Posted by Wanda on March 28, 2006 at 02:21:22:

Thanks for the advice John,

Actually my total debt is 46K and time is of the essence so the BK cannot be avoided at this point. However, I plan to try and sale my home shortly after everything is all filed and settled (within about 6 mos) and that depends on when a position becomes available for me in NC. I apparently have to ask the court for permission to sale my home, pay off the BK at 46K (which would have normally taken 5 yrs). I couldn’t stand them being in my business that long! However, I feel I have no other options and yes I’m working with an attorney and have already signed a contract. I will still have to give my brother half the equity if I sell. I plan to consult a real estate atty just as a last effort to prevent it. I’m willing to give him what he invested and a portion of interest but he doesn’t deserve half. I only hope the properties in NC won’t sky rocket before I can do all this because I really want to leave California.