QUESTION
Is a Deed in Lieu advisable after a Chapter 7 Bankruptcy discharge?
Asked on Apr 15th, 2013 on Foreclosures - Texas
More details to this question:
We have a home that was part of a Chapter 7 discharge. The bank is foreclosing but has just delayed the auction for the third time. I want to get this over with. Is there any danger of reaffirming the discharged debt in the Deed in Lieu process?
5 ANSWERS
If the deed in lieu requires you to reaffirm the debt, it shouldn't make much difference. After the BK, your credit rating can't get much worse. But if you are considering a deed in lieu, you shouldn't do it for free. Try to negotiate with the lender for some payment to you in return for the deed.
Answered on Apr 19th, 2013 at 3:20 PM
Bankruptcy Attorney serving Phoenix, AZ
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Law Office of D. L. Drain, P.A.
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It depends on the terms of the deed in lieu contract.
Answered on Apr 17th, 2013 at 10:19 PM
You are much better off with a short sale than a deed in lieu. A deed in lieu does not reaffirm the debt. Your 1st trust deed was not discharged. In a chapter 7, your 2nd was not discharged.
Answered on Apr 17th, 2013 at 12:16 PM
Business Bankruptcy Attorney serving Raleigh, NC
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J.M. Cook, P.A.
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It depends on the specific agreement with the bank. Several I have written did make you liable for a number of expenses and settling junior liens.
Answered on Apr 17th, 2013 at 12:16 PM
Bankruptcy Attorney serving Houston, TX
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Pamela L. Stewart, Attorney at Law
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Why would you make yourself liable for debt on home that is being foreclosed on and that was discharged? If you reaffirm the debt you will be personally liable for any deficiency on the home when it is foreclosed. I would definitely advise against reaffirming the debt.
Answered on Apr 17th, 2013 at 12:16 PM