Foreclosure started, do I visit a bankruptcy trustee?

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undersc0re

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Foreclosure started, do I visit a bankruptcy trustee?
« on: April 29, 2015, 01:04:03 PM »
I am seperated male in Canada, I am on mortgage and title with ex mother in law and ex (seperated). I have not made last 3 mortgage payments on house and I have been threatened by collections that its now being sent to the next step. I moved out while I have a good credit check for renting....mother inlaw refuses to work with me to sell house at rock bottom price as she wants to make money off house and lives in it now.
I am in debt in credit line and auto loan and mortgage, no money would be pocketed by anyone if we were to sell it privately right now (break even).
Would it be wise to go see a bankruptcy guy now? Should I wait until foreclosure? Is the bankruptcy trustee going to con me into it earlier to get business? What should I be careful of at this point? I am single father of a young girls with a full time nanny due to work responsibilities, I feel like the situation is pushing me towards foreclosure and then bankruptcy if the bank and cmhc go after me especially with the current debts. Would I be protected from foreclosure related collections including cmhc sueing me 3 years from now if I claim bankruptcy?
I am making minimum payments on my overdrafted chequing account, auto loan, and credit line in hopes the ex mother inlaw decides on a quick sale of the home, but its almost too late and she is very unstable and I can not trust anything she says.

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NotATrust-E

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Re: Foreclosure started, do I visit a bankruptcy trustee?
« Reply #1 on: April 29, 2015, 02:00:20 PM »
Would it be wise to go see a bankruptcy guy now? There’s no harm in going for a consultation to get a sense of what your options are. He may try to push you into filing sooner – you can always talk to multiple trustees to get their opinions.

One option that the trustee would likely discuss is returning the house to the bank. When this happens, the bank (or CMHC) may file a claim for the shortfall, but I believe (but am not certain) that this deficit would be included in your bankruptcy.

As long as you’re the only one on the mortgage, (even if she’s on title) this shouldn’t be an issue. Your ex-mother-in-law will have to find somewhere else to live. This might push her into making a deal.

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undersc0re

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Re: Foreclosure started, do I visit a bankruptcy trustee?
« Reply #2 on: April 29, 2015, 06:03:46 PM »
All 3 of us are on the title and mortgage, I am just scraping by without paying the mortgage payments right now. The mother inlaw refuses to work with anyone. So the foreclosure process will be a long one thanks to her, she is bitter and crazy and has not worked with us to sell the house, only if she were to get a windfall of money which the ex and I can not afford now. So its a funky situation.  The forcing of a sale is a long process that will not happen in time to save face apparently. I guess I can talk to a trustee, its just that I don't want to get pushed into doing something too early or too late.

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undersc0re

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Re: Foreclosure started, do I visit a bankruptcy trustee?
« Reply #3 on: June 23, 2015, 10:49:42 PM »
It was suggested that I get things in order for rough times, and that I find a cheap place to live while my credit allows me to apply successfully. They said foreclosure can take almost a year before the house actually goes for sale, the bankruptcy person said if I can get by for now with bills and food and a place to live that I should wait until the foreclosure finishes before starting the bankruptcy process. I was told I will have 2 options in BC, make a proposal and make payments for like 5 years or full bankruptcy with 21 months of bankruptcy protection and handing over monthly financial information and handing them 50% of any extra money I make on top of what they allow me to keep if that ends up happening. And its not free to file for bankruptcy, I think she said it was almost $2000 after everything.

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NotATrust-E

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Re: Foreclosure started, do I visit a bankruptcy trustee?
« Reply #4 on: June 27, 2015, 09:42:57 PM »
I saw you posted questions in two separate sections. I'll try to answer as well as I can:

1) The standard fee to go bankrupt is in the region of $1,800-$2,000.
2) When choosing a proposal, you'll want to make sure that the CMHC amount is reasonable. Once the foreclosure happens, you'll get a shortfall amount from CMHC - hopefully it's reasonable.
3) If you make more than about $2,000 in a one person bankruptcy, you will be bankrupt for at least 21 months and half of all the money you make over $2,000 will have to be paid to the trustee.
4) What happens if CMHC tries to come after you while bankrupt? I'm not sure. It was my understanding that it would be included in your bankruptcy. However, if you're doing okay for now but know that you'll have to file at some point, it might make sense to wait it out until you get the amount from CMHC.

 

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