Surrendering Your House

If you bought a house during the housing boom when prices were high and credit was cheap, then discovered you can’t afford it, what do you do?

One thing you can do is move out right away. We generally don’t recommend this. Until the bank forecloses, it is still your house. You are free to remain at the house until a court orders otherwise. So stay in the house and save the money that would have been used to pay the mortgage to save up for moving and security deposit on a new place when you do have to move.

With Act 48 putting the brakes on non-judical foreclosure, almost all foreclosures are going through Circuit Court. This means at least 4-6 months of Court process before someone else is the owner of your house. On the neighbor islands, it is even longer. A bankruptcy filed during the foreclosure process can add another two months to the process of foreclosing, meaning you could remain in even longer if you time your bankruptcy right.

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