Posted on: 22nd Jul, 2009 04:46 pm
hi,
i have a loan w/ countrywide about $410,000 and value of house now is about $330,000.
i have home equity loan about $45,000 and credit card debt about $30,000.
what should i do?
since my house is very old, i do not want to keep it.
should i either consider foreclosure or chapter 7 bankruptcy?
which is more severe between foreclosure and chapter 7 bankruptcy for rebuilding credit again?
thank you
i have a loan w/ countrywide about $410,000 and value of house now is about $330,000.
i have home equity loan about $45,000 and credit card debt about $30,000.
what should i do?
since my house is very old, i do not want to keep it.
should i either consider foreclosure or chapter 7 bankruptcy?
which is more severe between foreclosure and chapter 7 bankruptcy for rebuilding credit again?
thank you
Hi pfjc,
From credit point of view, both foreclosure and chapter 7 have similar effects. The drop in your credit score depends on your individual situation. But you can expect a drop of 200-250 points in your credit score, irrespective of either a foreclosure or a chapter 7.
In a foreclosure, you will be responsible for the deficiency. The lender can sue you if you do not pay off the deficiency. But in chapter 7 bankruptcy, you are personally released from the liability of the mortgage. You will be discharged from your debts. Thus, the lender will not be able to come after you for the deficiency.
From credit point of view, both foreclosure and chapter 7 have similar effects. The drop in your credit score depends on your individual situation. But you can expect a drop of 200-250 points in your credit score, irrespective of either a foreclosure or a chapter 7.
In a foreclosure, you will be responsible for the deficiency. The lender can sue you if you do not pay off the deficiency. But in chapter 7 bankruptcy, you are personally released from the liability of the mortgage. You will be discharged from your debts. Thus, the lender will not be able to come after you for the deficiency.
is country wide your first mortgage? i think the only way to do is short sale or deed in lieu of foreclosure. which state are you in??
I'm in California
Hi pfjc,
In my opinion, it would be better if you could apply for a deed in lieu foreclosure. This will help you in selling off the property and you would not be liable for the deficient amount resulting from the sale of the property.
Thanks
In my opinion, it would be better if you could apply for a deed in lieu foreclosure. This will help you in selling off the property and you would not be liable for the deficient amount resulting from the sale of the property.
Thanks