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  1. #1
    Join Date
    Oct 2010
    Posts
    1

    Default Chapter 13 Foreclosure and Rental Property

    Hello,
    I was hoping someone can provide insight on this topic regarding filing a chapter 13. My home is currently in foreclosure in the state of CT. We are currently in court mediation and our recent meeting with the court has advised us to put the house on the market and/or to fully reinstate the mortgage by 2/1/2011 - a foreclosure won't happen until after 2/1/2011. We are currently looking into other options and was considering renting the property and then filing Chapter 13 which allows us to have more dissposable income then moving back into the property in a year. Anyone know the logistics of this..if the bankruptcy court will let us keep the house? I know that renting will make us able to afford the home while I look find a better paying job.

  2. #2
    Join Date
    Sep 2005
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    Behind a Desk
    Posts
    98,846

    Default Re: Chapter 13 Foreclosure and Rental Property

    Do you have any equity? You have to be careful about losing your homestead exemption. Also if you're paying a mortgage payment on the property as an investment property, the trustee may question why you should continue to own that property subject to the mortgage obligation if the net effect is that you have less disposable capital to pay off your creditors, as could be the case if you're simultaneously paying rent elsewhere.

    Really, you should discuss your options with your bankruptcy lawyer.

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