QUESTION
Should I do a deed in lieu after a chapter 7 because I don't live in the state anymore?
Asked on Jun 11th, 2012 on Bankruptcy - Florida
More details to this question:
I was forced to move from Nevada in 2010 for work. I couldn't afford the property I owned in Nevada as well as rent on a new home. I tried to do a short sale but the second mortgage wouldn't agree to the terms. The second mortgage then filed a lawsuit against me forcing me to declare chapter 7 bankruptcy in late 2011. I was discharged in January of 2012 but the first loan is with BofA and is still reporting late every month even though it was discharged in the loan. I want to get a fresh start and I am concerned that this home still hanging around is ruining my credit further so I am interested in a deed in lieu. However, I am worried that the deed in lieu will possibly open a new liability to the bank or that I would have to show my new financials which are much higher than when I filed for BK and they would be able to deny the deed in lieu. Any suggestions as to whether I should do it or just wait it out? I am also concerned about the house remaining in my name due to liability issues as the home has a pool and I wouldn't want to get sued by anyone.
7 ANSWERS
A deed in lieu might be a good deal for both you and the bank, but it will only work if both you and the bank agree. You cannot force the bank to accept a deed in lieu. Under no circumstances should you sign anything that obligates you to pay any money to the bank, ever, no matter what. If the bank won't foreclose and won't accept the deed in lieu, then hire a real estate agent to rent the house out. Collect the rent and keep it (but be sure to report it on your taxes). Turn a lemon into an asset. Don't worry about what Bank of America is "showing". They do not determine what is owed and what is not. You have your discharge. Just relax. One piece of advice. Make sure that there is insurance on the house. Your insurance, not the bank's insurance. You need to protect yourself against property owner's liability if there is a personal injury on your property. Keep the insurance until the deed in lieu is recorded or the foreclosure is complete.
Answered on Jun 22nd, 2012 at 7:12 PM
You definitely need to speak with an attorney. Just because the bank has a mortgage does not mean that it has to foreclose. As long as you own the house, you are liable for injuries sustained by persons who visit the property. Have you thought about renting?
Answered on Jun 21st, 2012 at 4:06 PM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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It is my strongest counsel that you seek an attorney in Michigan as quickly as possible to follow up on this bankruptcy and with the bank. Without additional information is impossible to give firm advice.
Answered on Jun 20th, 2012 at 9:06 PM
Bankruptcy Attorney serving Phoenix, AZ
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Law Office of D. L. Drain, P.A.
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Your first lender will not take a deed in lieu with a second loan on the property. You can talk to a Nevada real estate attorney to see options, but I don't know of any. Eventually the lender will foreclose.
Answered on Jun 20th, 2012 at 8:09 PM
Bankruptcy Attorney serving Livonia, MI
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Charles J. Schneider, P.C.
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Keep up property insurance on the home and wait till they foreclose.
Answered on Jun 20th, 2012 at 8:03 PM
Commercial Bankruptcy Attorney serving Davie, FL
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Law Office of Jeffrey Solomon
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Your debt has been discharged. They should not be posting additional negative comments on the credit report. But as owner, you could have liability such as for association fees or if someone slipped and fell on the property. A short sale or deed could be helpful. You should consult an attorney.
Answered on Jun 20th, 2012 at 7:04 PM
Criminal Defense Attorney serving Deltona, FL
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R. Jason de Groot, P.A.
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You need to consult with your bankruptcy attorney about this. You filed bankruptcy in Nevada and should consult a Nevada attorney. As a general rule the bank does not want a deed in lieu, they have filed a foreclosure and will get title through that avenue. The debt to BofA was discharged as was the debt on the second mortgage. You have a fresh start. Your credit report should be reporting that the debt was discharged.
Answered on Jun 20th, 2012 at 6:32 PM