QUESTION
Am I responsible for a foreclosure property after filing bankruptcy?
Asked on Jun 04th, 2011 on Bankruptcy - Tennessee
More details to this question:
I filed for chapter 7 bankruptcy in 8/09 & received my discharge in 01/10. In my BK I surrendered a rental property. The lender still has not foreclosed but took possession of the home & changed the locks. Now the HOA are coming after me because the yard is in disrepair. I have no money to fix the problem. And how can this be my responsibility, when the lender took possession?
9 ANSWERS
Bankruptcy Attorney serving Concord, CA
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William Rubendall Attorney at Law
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There are special provisions in the bankruptcy code to protect HOA's. You are liable for post-bankruptcy fees until the property is foreclosed. Notify the lender that you are willing to give them a deed in lieu of foreclosure. Also, notify the police department that the lender is trashing the property after they have changed the locks and taken physical possession.
Answered on Jun 08th, 2011 at 9:15 AM
Bankruptcy Attorney serving Herndon, VA
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Maureen O'Malley
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Unfortunately, the statute makes it your responsibility "for as long as the debtor or the trustee has a legal, equitable, or possessory ownership interest" in the property. This is hard-ball playing by the lender in that you can't get into the house, but you do still have the right to sell it, and it is still your possession. Therefore, HOA fees are your responsibility. You might ask the HOA if they'd like to foreclose. That would at least take it out of your hands. (I doubt they'd accept, though.)
Answered on Jun 08th, 2011 at 8:55 AM
In a bankruptcy, when you surrender your real property, you are no longer responsible for the deficiency of the debt on the property, however you are still held responsible for continuing debts that accrue after filing, such as electricity, water and other taxes. In order to avoid any excess new debt from a property you surrender it is advisable for you to deed over the property to the bank in either a deed in lieu, short sale, or quit claim type deal. Thanks for tuning in.
Answered on Jun 08th, 2011 at 8:53 AM
Information provided doesn't create an attorney/client privilege nor constitute an offer of services and is only general responses to hypotheticals
Litigation Attorney serving Portland, OR
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Daniel G. Hoarfrost
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You shouldn't be responsible for HOA charges. Since your name still remains on the title, they will look to you for payment. All you can do is make sure they are aware of the bankruptcy and refer them to the lender who has taken possession and control.
Answered on Jun 07th, 2011 at 3:47 PM
Spencer Hale
Unfortunately, the HOA collects from the owner of record. Since the house has not been sold, it is still in your name.
Answered on Jun 07th, 2011 at 2:38 PM
The property, including the HOA fees and fines, is your responsibility until the deed transfers.
Answered on Jun 07th, 2011 at 1:43 PM
Trusts and Estates Attorney serving Jacksonville, FL
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Law Office of David M. Goldman PLLC
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You should review this with your bankruptcy lawyer. It might depend on how you listed the HOA in the bankruptcy and when the debts are from.
Answered on Jun 07th, 2011 at 1:01 PM
Glen Edward Ashman
It sounds like you may have made the horrible mistake of a bankruptcy without counsel, as your counsel would have answered you. Until title changes, via a foreclosure, deed in lieu or other device, YOU remain responsible for the taxes, HOA fees and maintenance. You can, for example, be fined or even jailed by the local government for high grass, etc. It is possible that your lender made a misstep in changing the locks before getting title. This is a web that you need your lawyer to untangle, if you have one. If you don't, consult with one to see what he can come up with.
Answered on Jun 07th, 2011 at 12:37 PM
William C. Gosnell
You are not liable to HOA. Go back to your chapter 7 lawyer and get him to write a letter to them to get them to stop.
Answered on Jun 07th, 2011 at 12:07 PM