Let me start off by saying that my wife and I have NO bad marks currently on our credit report. Our scores are identical at 661 (equifax), which is because of our extremely high use of revolving debt. With about 40K in CC debt, being (seriously) upside down on our house, and monthly payments exceeding our income (even before servicing unsecured debt!)... We have decided it's time to file before we start missing payments.
The attorney we spoke to yesterday also serves as a Trustee so I do not doubt his knowledge of the system... however he isn't a credit expert.
He is advising us to STOP making mortgage payments as the foreclosure process will take 10 - 12 months. We can save up that money and use it as a down payment on another house at that time (he gave me the number of a mortgage broker that could aid in this process). I really think we are going to look into renting instead...
Moral issues aside:
1) If the house is going to be foreclosed upon anyway, will it hurt our future credit rebuilding efforts to stop making these payments now?
2) Can a house be foreclosed upon by simply not reaffirming the mortgages (and being current on payments)?
3) At what point do we stop making payments? After discharge?
4) Is the double whammy BK/foreclosure hit on my credit report going to be as bad as I think it will be?
5) We are going to reaffirm a couple of items (again perfect payment history)... will this give us any sort of 'FICO' advantage? What about our perfect payment history prior to BK?
Thank you for any help!