Possible foreclosure and consumer proposal

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We have already sat down and realized that we have 111,000 in unsecured debt. We met with a trustee prior to the bankruptcy act changing and he said that a proposal was our best way but we should still consider our house as the mortgage payments are so high. So no rush now that its not a bankruptcy under old terms (we have excess montly income to deal with). Again, met to go over the paper work and brings up the house and tells us to strongly think about it. We take a month and think about it alot and decide to give up the house (we will be in a deficit on our mortgage payout on a cmhc mortgage) so we talk about foreclosure. After the month I call him back and let him know we have decided to let go of the house to be told that it cannot be dealt with in a proposal only a bankruptcy which with the changes is not in our favor at all. what are our choices? Wait for foreclosure and then deal with a foreclosure defecit ina proposal or is bankrupcty the only way? In which our bankruptcy payment would be so huge it wouldnt be feasible? Feeling very trapped!

Posted on Saturday, January 9, 2010 | Filed under: Bankruptcy
 posted by Questions @ 3:39 pm 1 Comment
1 Expert Comment:

 At January 11, 2010 | 1:44 pm , Bart Goth, Trustee in Bankruptcy Said...

I am not sure why it cannot be dealt with in a consumer proposal. CMHC would still be an unsecured creditor and I have seen many consumer proposasl that have had this type of shortfall listed. The only problem may be logistics as it will take CMHC a little bit of time before the loan gets passed to them from the bank. So in the mean time the question is who votes, the bank or CMHC. The easy solution is to wait a little while before filing the propsoal. That way the paperwork all gets sorted out. Alternatively you can estimate the shortfall, push ahead, and see if we can get the original mortgage to vote or at least speed up getiing CMHC involved. This second approach is less than ideal, but still very possible. If you need to discuss this further feel free to contact me at 780-435-5110.

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