Bankruptcy after foreclosure - double whammy on FICO?

[Anonymous]

hello,

my property has been foreclosed upon. i've now been laid off, may be responsible for a $108K HELOC, and have about $26K in CC debt. Two bankruptcy lawyers i've spoken to both have said that filing for BK now will protect me from my debts and allow me to rebuild my FICO score quicker and easier. The debt protection makes sense, but before i proceed i want to get as much information about how both a foreclosure and a BK with affect my FICO score and the repairing of it. anyone have any advice, please?

thanks 

[Anonymous]

I had two properties foreclose.  One of them shows as foreclosure redeemed on my credit reports I'm not really sure what that means.  Other than the properties I had, my own credit cards and loans were paid on time and not late but I decided to file chapter 7 anyway.  My chapter 7 was discharged July of 2008 and I've already applied and been approved for a Orchard bank 300 cl and Target store card 200 cl.  It's not much but it's something, My scores are TU 625 EXP 645 EQU 611.  My own credit was not bad when I decided to file so I think that is why my scores are somewhat decent.  Remember 2 years after your discharge you can apply for an FHA mortgage loan so there is light at the end of the tunnel.  Also this is VERY IMPORTANT!!! When you receive your discharge you have to make sure all of your credit reports are reflecting accurate information.  Make sure your personal information, addresses, employment information, accounts EVERYTHING is ACCURATE.  Make sure every single account you included in your bankruptcy says included in bankruptcy or discharged through chapter 7.  Your payment status account status whatever they want to call it MUST SAY discharged in bankruptcy!  Also try to dispute old stuff you didnt include in the bankruptcy if its negative.  I hope this helps.

Honeychild

[Anonymous]

it does help, thanks honeychild!

[Anonymous]

Unfortunately the foreclosure may be worse for you than the BK. You have to wait 2 years from discharge; that is correct. However, you must be 3 years out from foreclosure - and they use the date that the property was sold at sheriff sale. With ours, it took over 2 years for the property to be sold. (Wish I'd known that was going to happen - I'd have saved a bundle on rent - but I couldn't live with every day wondering if we were going to get an eviction notice.)

While a deed-in-lieu or a short sale won't make any difference in your credit scores, they will start the 3 year mark rolling a lot sooner than waiting for the foreclosure process to work its way through. (Filing BK will temporarily halt the process - good in that you have time to get things together and save a little money to move out with, but bad in that it's just that much longer you have to wait afterwards.