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Monday53

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Forclosure vs Short sale, after Bankruptcy
My chapter 7 bankruptcy was discharged in 2009. I did not reaffirm y first or second mortgage. I am upside down and also can not afford the payment. Both loans show discharged, like I do not owe anything.

I am not behind on my payments, and now have a credit score of 701.
I need to move to a more affordable place. Would my current credit score be lowered by a foreclosure.? I keep reading that it is not worth it to do a short sale, by attorneys on line, if you are protected by bankruptcy. I live in Ohio . I could use some good advice.

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I'm not sure I fully understand your situation, but here's what I think (I work in the mortgage and credit repair industries).  Short sale is best bet if you mortgage lender will agree to it.  Second best option is doing a Deed In Lieu of Foreclosure (DIL), that only stays on your credit report for 5 years, whereas a foreclosure stays on for 7 years.  However, since your mortgage payments are current, they will not consider a DIL until they are close to foreclosing, so you'd have to miss a couple payments for that to be an option.  One other option, especially since you are current on your mortgage is to request a loan modification with your current lender.  I would definitely sit down with your mortgage lender and have a hear-to-heart talk.  Since they know you were in bankruptcy, they may be willing to work with you.  Good luck!

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