Foreclosure in 92592>Question Details

Cavine, Home Buyer in Bel Air, MD

Foreclosure or Deed In Lieu after Chapter 7 Bankruptcy

Asked by Cavine, Bel Air, MD Mon Jan 14, 2013

How will my credit be affected by Foreclosure or DIL after my mortgage shows as Discharged in Chapter 7 Bankruptcy. I tried Short Sales, but the bank failed to negotiate and I lost all the contracts. I declared Chapter 7 in 2008. Will my credit take another hit from Foreclosure or DIL?

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14
Yes, I'm with Kevin. Thank you for the update.
0 votes Thank Flag Link Sun Aug 18, 2013
Thanks for the update Cavine - I suspect you will get a 1099C if the lien holder received less than they were owed. The "approval letter" has the terms they agreed to. Your Broker should have provided it to you. If you didn't get a copy, ask them to deliver to you.
0 votes Thank Flag Link Sun Aug 18, 2013
Homeowners who have had a foreclosure or short sale years ago just got approved to buy a new home. Check if you qualify for a mortgage. Try http://www.whywaitbuytoday.com
0 votes Thank Flag Link Sun Aug 18, 2013
Ok, here's the outcome of the Foreclosure or Deed In Lieu after Chapter 7 Bankruptcy.....After 2 1/2 years, and 6 lost contracts, the 7th was the magic charm. It was a cash deal and even though the bank raised the asking price $5,000, the buyers accepted. The house closed on 5/28/13, but I'm not sure it was considered a Short Sale, since the mortgage was listed as Discharged through Chapter 7 Bankruptcy in 2008. I'm still trying to find the answer to that question.

I want to thank everyone who took the time to answer me, it meant so much that people that didn't know me would offer their words of encouragement, well most anyway.
0 votes Thank Flag Link Mon Jul 1, 2013
I'm with Kevin. We often give advice here and never hear back the outcome. It's always nice ot get an update from the person who asked the question.
0 votes Thank Flag Link Sun Jun 30, 2013
Hi Cavine, Curious if you have gotten the help you were looking for - Let us know if we can be of any further assistance.
0 votes Thank Flag Link Sun Jun 30, 2013
If the mortgage was included in the bankruptcy, you will have to wait 3 years from the date the deed to the property transfers out of your name to apply for a FHA loan. You need to only wait 2 years from a Chapter 7 bankruptcy to get a FHA loan, but if their was a mortgage in the BK 7 then the lender will go off the date the property that mortgage was secured by is sold, and you will need to wait a minimum of 3 years from that date. Only 2 if you are VA eligible.
0 votes Thank Flag Link Sat Jun 29, 2013
I had a buyer that wanted to buy a home in Arizona, but he had a Chapter 7 bankruptcy 7 months ago. After researching the web I found a loan program at http://www.cfsflex.com, they allow a mortgage after a foreclosure. There is only a six month waiting period. Good to see lending options coming back.
0 votes Thank Flag Link Sat Jun 29, 2013
Has your problem been resolved? If not, feel free to contact me anytime.
0 votes Thank Flag Link Sun Mar 24, 2013
I may be wrong, however it sounds from your comment that you tried to do a short sell back in 2008? If that's the case I would definitely try again today. Banks have come along way with short sale approvals since 2008. In fact, Often times the bank will offer relocation assistance in the short sale. There are some banks that are offering relocation Assistance anywhere from $2500-$30,000, it's a win-win situation if you can get a short sale approved.
0 votes Thank Flag Link Tue Jan 15, 2013
I get a feeling your lender is most likely Wells Fargo ? Please help us get President Obama to answer a vital question: If you're reading this, please send an email to OREILLY@FOXNEWS.COM and on Superbowl Sunday, Feb. 2, 2014 the question will be answered LIVE by the President:
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Flag Tue Jan 28, 2014
No, I didn't try to do a Short Sale back in 2008. I tried the HAMP route but the bank screwed me. They told me I qualified and cut $266 a month from my payment. If I paid ontime for 3 months, I was automatically accepted. I paid for 9 months and got a Letter Of Intent To Foreclose for the difference of what they told me to pay and what I should have paid. After I borrowed the money to stay out of Foreclosure then, I left the home. It's been for sale since before I moved out. They never Foreclosed on me. My realtor suggested a Short Sale 2 years ago. I've lost 7 contracts due to the bank not responding. I'm ready to just let them take the darn house and be done. The last Short Sale contract was 7 months ago. The buyer has held on, but is now ready to kill the contract. Why it should take over 7 months is beyond me. The house has been empty for 2 years. I'm just trying to protect what's left of my credit. DIL or Foreclosure.........what will hurt me less?
Flag Tue Jan 15, 2013
A Deed In Lieu will be less impact on your fico than a foreclosure. But ideally, you should be able to bounce back from both and the BK in 2-3 years. Each 30-90 day late could lower you 30-60 points per inquiry but it is relevant to the credit you currently already have too and length of time you've had established credit. When your credit is ran, you can see under each bureau a description as to why they scored it that way, they also will be in order of importance. Have you gotten a tri merge lately?

Valli Lopez
CA DRE 01810641
619.916.9595 cell
Valli@thebrikhogroup.com
Web Reference: http://www.vallilopez.com
0 votes Thank Flag Link Tue Jan 15, 2013
Hello Cavine,

Yes, your credit has and will take a hit by the mortgage late payments, deed in lieu and or foreclosure.

Deed in Lieu.
You might want to discuss relocation funds for you to move out-

Good luck to you!

Scott and Shelley Weier
Cal State Realty
C2 Financial Corporation
0 votes Thank Flag Link Mon Jan 14, 2013
Hello Cavine,

Yes, your credit has and will take a hit by the mortgage late payments and foreclosure.

Deed in Lieu.
You might want to discuss relocation funds for you to move out-

Good luck to you!

Scott and Shelley Weier
Cal State Realty
C2 Financial Corporation
0 votes Thank Flag Link Mon Jan 14, 2013
It'll only take another hit if the mortgage reports the foreclosure/deed-in-lieu... as foreclosures & deed-in-lieu of foreclosures do not appear in the "public records" section of a credit report. However once a mortgage is included in bankruptcy I normally do not see any further activity on them afterwards, so I would say it's unlikely you'll see further damage to your credit score, but it's a possibility they will report it.

When it comes to qualifying for a mortgage, lenders will start the foreclosure/deed-in-lieu seasoning period from when that event actually happened, and not the bankruptcy discharge date.

Shane Milne | Lending in all 50 states | NMLS #81195
0 votes Thank Flag Link Mon Jan 14, 2013
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