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Posted by Joshua on February 24, 2003 at 24:16:51:

I've come across someone that is 8 months behind on payments and owes to the bank on his property $85,000. But he told me that he has filed for bankruptcy and I don't know what this does to the payments owed to the bank and such. So I am looking for what this does to his situation trying to sell the home. I don't know if there's a deal to be had or not cus of the back payments and also from what it sounds like, he's trying to work with an agent and get close to top dollar. But who knows?

Thanks
Joshua

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Posted by JT-IN on February 24, 2003 at 09:20:24:

Joshua:

No deal here... not b/c of the BK but b/c the owner/seller is not motivated. As you said, he is looking to get top dollar... whne they are looking to get OUT NOW, then they are looking for you or another investor with a solution.

To answer your question of what impact the BK has on the payments... The interest continues to accumulate, even though the BK is active and he is not making payments. The BK will keep the Creditor, in this case the mtg company, from attempting to actively collect a debt, including foreclosure. It stops all collection action until the Debtor has opportunity to restructure, as in the case of a Ch 13 BK, or to liquidate, as in the case of a Ch 7 BK. Eventually the Creditor will get a relief from stay, which means they can proceed ahead with collection action, including foreclosures.

You may want to passively track this property until the BK is dimissed or discharged, whichever comes first, then see if the seller gets more motivated.

Just the way that I view things...

JT-IN