bankruptcy/real estate/ long question?
A little background here.. I am trying to get myself out of a terrible financial situation. I was 22 when my husband and I bouught our first home (which is upside down) and started accumulating debt. I live in Las Vegas where the real estate market has plummeted. My husband and I are separated, and have about 45 thousand in debt bewteen the both of us. We keep tinkering back and forth between doing a bankruptcy or just paying our bills off.I have gotten setlements on 3 of my accounts, so that would bring me to 000 in debt approximately, the also offered to do a loan modification, POSSIBLY approved after a six month forebearance on our home. Bringing our payment from 00 a month to about 00. But we wont know for 4 months if that is even approved and it could go either way. I am in the reserves and trying to go on a deployment for 7-9 months that would be about 000 tax free before the end of the year. If I do a Chapter 7, I believe the majority, if not all, of that money is protected. I could save it, and use about 1/2 of that to buy an investiment home, but I won’t be able to buy one until after statue of limitations which is 2 years minimum?? If I don’t do a bankruptcy then I plan to pay off the settlement accounts first, while paying the others off consecutively (monthly) to reestablish history.after 6 months to 1 year of rebuilding my history then I want to buy an investment home. I am now 25, and I know now basic necessities to be secure. Such as 3-6 months emergency fund, as 0- minimum amount of debt as possible, and securities to help me survive or profit from the recession, my choice is real estate since I’ve studied it, I enjoy it, and I believe firmly I know how to make money in it. And I don’t know much about any other market, such as the stock market, orinvesting.Please help. We have been riding the fence for about 7 months, wasting time because our minds keep changing. We are separated but which ever way we decide to go with this we plan to help each other. I want to build my wealth, become secure, and have long term investments. I want to start up a business (home staging) within the next 3 years also.
3 Responses
mysery0125
05 Feb 2010
stephenweinstein
05 Feb 2010
Following a bankruptcy, it is generally impossible to get a mortgage for 7-10 years. Your expectation of buying an investment home after either 6-12 months or 2 years is unrealistic unless you expect to have enough cash to put down the entire purchase price (100%) of the investment home.
OC1999
05 Feb 2010
From what you sound like you are trying to do, it seems like you have some unrealistic expectations. It does not sound like you would be a candidate for a Chapter 7 Bankruptcy. You may be forced into a Chapter 13 Bankruptcy. With a Chapter 13 they will have you repay a portion of your debts over the next 3-5 years. During this time there is no way the Trustee would approve your purchase of any investment property.
The best thing to do is talk to a lawyer. They can go over all of this with you and give you your options. Most will give you a free short consultation.
One other thing you have to consider is that if you are just separated and not divorced do you bring your (soon to be?) Ex into the BK or file on your own.
Bankruptcy should be your LAST option. That’s 10 years of credit problems. High interest loans, multiple turn downs, and again, it sticks around for 10 years. If you are honestly working with current creditors and negotiating settlements then I would suggest you stick with that option. This shows that even when times got tough, you managed to work with these creditors to pay your debts. Most will look at this more favorably than just filing for bankruptcy. Your best option is to try to work things out with your current creditors. Being married still, I believe the debt(s) belong to both of you. You both need to be on the same page about this. Joint accounts????? He files, you don’t. You file, he doesn’t. One of you ends up getting stuck. Make sure you both agree to something, get it in writing!!!! Who knows where the two of you will stand a year from now. I’ve been through the bankruptcy option and wish that I had done things different. The choice is yours ultimately, just be sure that your ready to accept things after. Best of luck to you both.