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cfortunato
cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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I am a US military member who had a significant reduction in

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I am a US military member who had a significant reduction in pay about 5 years ago (lost a bonus). At the same time my wife lost her job because of a transfer. I tried to get out of the military, but my resignation was denied. My wife could not find work at our new duty station, and we lived apart for two years where she could find work. We have a house that is worth half of its mortgage that we had to support, that we also could not rent for the mortgage, and we were forced to support three households. Because of my clearance I floated the difference on my credit card, which gradually inflated. Then we were transferred again. Before this, I spoke to a real estate agent who advised a short sale, and to stop paying on the mortgage to facilitate this. This freed up money and we started to pay down bills.

We had an offer on the house, and we thought we were out of the water, but it fell through after 10 months of negotiations. My wife has not found another job, we transferred again, and things are difficult. I can start paying down my debt without the house, but it is still out there. I still pay electricity, water, taxes and HOA dues, just not my mortgage, and it has been a year and a half since I stopped paying it (on the advice of a real estate attorney and the realtor). My credit is now damaged, and I just want to recover, but nothing is happening on the house, and to their credit, the mortgage companies (two mortgages) do not want to foreclose on a service member. But I feel like I am stuck, I cannot recover until the house is gone, and it is hanging around my neck like an albatross. Should I just declare bankruptcy?

cfortunato :

Hi - my name is XXXXX XXXXX I'm a Bankruptcy and Consumer Protection attorney here to assist you.

cfortunato :

Are you still living in the house?

Customer: No, we moved away several years ago due to a military transfer and are unlikely to ever return.
cfortunato :

Thank you for your response.

cfortunato :

The mortgage lender will be more likely to foreclose if you stop paying the expenses for the house.

cfortunato :

When there are HOA dues involved, it is usually a good idea to wait as long as possible before filing a Bankruptcy, because a Bankruptcy can only discharge the dues that are owed at the time you file.

cfortunato :

You will remain liable for any dues that accrue after your Bankruptcy is filed.

cfortunato :

So, filing a Bankruptcy at some point would be a good idea - so that you do not have to worry about the lender trying to collect the balance owed on the mortgage - but if possible, it would also be a good idea to wait until after the house forecloses.

cfortunato :

If you stop paying the HOA dues, the HOA will also be allowed to foreclose the house.

cfortunato :

As will the taxing authority if you stop paying the taxes.

Customer: If they wait to foreclose this will only delay my recovery time, is there anything I can do or is it just a waiting game?
cfortunato :

The only things you can do to speed up the process is to stop paying the expenses.

cfortunato :

If you stop paying the expenses, the bank will have to pay them - or lose the house.

cfortunato :

You can also contact the lenders and explain that you do want to foreclose.

Customer: Ok, thanks!!!
cfortunato :

And that they should not delay the process based on the fact that you are a service member.

cfortunato :

You're welcome.

cfortunato and 4 other Bankruptcy Law Specialists are ready to help you

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