QUESTION
Can I walk away from my home if it was included in the bankruptcy and never refinanced?
Asked on Sep 15th, 2011 on Bankruptcy - Massachusetts
More details to this question:
I had a bankruptcy 6 years ago. My home was included in the bankruptcy. Since then I have continued to pay the mortgage. Can I walk away from the home since it was included in the bankruptcy and it was never refinanced?
9 ANSWERS
If you did not sign and file a reaffirmation agreement, then you can walk away from the mortgage and not be responsible for the foreclosure deficiency. You must, however, keep the house insured and in compliance with zoning and other applicable laws to avoid any future personal liability before the deed transfers out of your name to the bank or a subsequent buyer.
Answered on Sep 19th, 2011 at 1:47 PM
Bankruptcy Attorney serving Concord, CA
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William Rubendall Attorney at Law
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When you file bankruptcy your home loans are included. The lender retains a security interest. You no longer have personal liability for the loans. You can give up the home without owing anything because of the bankruptcy discharge.
Answered on Sep 16th, 2011 at 2:58 PM
Daniel James Wilson
Yes. Your bankruptcy discharged the underlying debt that is secured by your mortgage.
Answered on Sep 16th, 2011 at 1:36 PM
Bankruptcy Chapter 7 Attorney serving San Diego, CA
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Law Office of Asaph Abrams
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Absent reaffirmation (signing of an agreement during the pendency of the bankruptcy case to repay an otherwise dischargeable debt), one may walk away from secured collateral and not owe a deficiency balance/incur liabilities. No legal obligation is effected by virtue of having made voluntary payments. This answer (as well as our Web site) doesn't address all facts & implications of the question; it's general info, not legal advice to be relied upon; it creates no attorney-client relationship; it may be pertinent to CA only; it's independent of other answers. Hire legal counsel before acting or refraining from bankruptcy/legal action.
Answered on Sep 16th, 2011 at 11:06 AM
Bankruptcy Decision Attorney serving San Diego, CA
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Law Office of Daniel G. Shay
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Yes, the debt was incurred prior to filing and is dischargeable. However, you will have a foreclosure on your credit report. A short sale would prevent that.
Answered on Sep 16th, 2011 at 10:46 AM
Samuel Lee Tucker
The reality is that by the time the mortagee gets around to seeking a judgment on the deficiency, if any, you will qualify to file another bankruptcy by passage of time.
Answered on Sep 16th, 2011 at 10:45 AM
As long as you did not reaffirm the debt, you can walk away without a deficiency.
Answered on Sep 16th, 2011 at 10:43 AM
Information provided doesn't create an attorney/client privilege nor constitute an offer of services and is only general responses to hypotheticals
Glen Edward Ashman
That depends on things that you did not tell us. If you did not sign a reaffirmation agreement AND the case is a discharged chapter 7, yes.
Answered on Sep 16th, 2011 at 9:51 AM
Consumer Bankruptcy Attorney serving Worcester, MA
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Law Offices of James Wingfield
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Assuming your home loan was discharged in a bankruptcy and you received your discharge, then you can walk away from your *mortgage*, without fear of recourse from the bank for a deficiency judgment. But beware, if you just leave your house, there are likely to be post-bankruptcy petition charges for which you may still be responsible, such as insurance, taxes and utilities. The biggest issue could simply be liabilities. Vacant houses can attract the trouble, and could cause you far more than simply monthly expenses. Your best bed is to negotiate a deed in lieu of foreclosure with your lender (where you hand over the a deed to the house) before you leave or staying in the house until it is foreclosed upon (and paying the normal expenses, including taxes and insurance, but not the mortgage itself).
Answered on Sep 16th, 2011 at 9:38 AM