QUESTION
What would happen with the home and the bankruptcy if my name is still on the mortgage?
Asked on Aug 18th, 2014 on Bankruptcy - Michigan
More details to this question:
I am divorced. I signed a quit claim deed for the home, however, he has not refinanced the home yet and my name is still on the mortgage. There is $50,000 in equity.
8 ANSWERS
William M Stoddard
You have not interest in the home. If you file, you cannot list it as an asset. However, so long as your name is on the mortgage, you owe the debt, which clearly appears to be covered with its value. List the debt and this effectively notifies the creditor that you will never be obligated to pay. He should be told you are filing so he can talk with the bank so they know your notice is coming. Your filing has not effect on his obligation to pay and or be paid off if he sells.
Answered on Aug 21st, 2014 at 8:19 AM
Your former spouse's bankruptcy will discharge his personal liability on the mortgage. You remain liable on the mortgage. If there is less than $60,000 of equity in the house, he should be able to claim the house as exempt and keep it.
Answered on Aug 21st, 2014 at 8:05 AM
I can't tell what you want to know. You don't own the property anymore since you quitclaimed it to your ex, presumably by a court order from the divorce. Was he ordered to refinance the mortgage? Good luck trying to get that enforced in the family court! It never happens. Filing bankruptcy will discharge any obligation you still have to pay the mortgage. However, bankruptcy will not take your name off the mortgage. The mortgage payments, whether good or bad, will no longer be reported on your consumer credit report.
Answered on Aug 20th, 2014 at 11:13 AM
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Since the question is vague, I'm going to assume that you intend to file a Chapter 7 bankruptcy. After discharge, you would no longer be liable on the mortgage. There is a possibility that the bankruptcy court would consider your signing a quit claim deed to be a gift of your 1/2 the equity ($25,000) and go after your ex for that money.
Answered on Aug 20th, 2014 at 10:38 AM
Bankruptcy Attorney serving Grand Rapids, MI
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David Andersen & Associates, PC
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Possibly a small interruption to statements on the home for your ex-husband. You would eliminate your obligation on the mortgage in the bankruptcy.
Answered on Aug 20th, 2014 at 6:30 AM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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Your credit score takes a major hit but with $50,000 equity it is doubtful you have cash due. I would like to review the judgment before rendering an opinion.
Answered on Aug 20th, 2014 at 6:26 AM
If you were divorced within the last 2 years, most trustees will want to see the divorce decree and how the property was divided up. You would also have to disclose the transfer of your interest in the property on the appropriate place in the bankruptcy papers. Then you would just list the mortgage lender as an unsecured creditor since you no longer have an interest in the house. The trustee would then decide whether to go after your ex for some share of the property, but the risk is fairly low if the property division was approved by the state court. Much depends on the timing and the perceived fairness of the property settlement. If it was fair, the trustee is unlikely to disturb it. But the more recent it was, the more likely it will be scrutinized.
Answered on Aug 20th, 2014 at 6:26 AM
It depends upon who is filing bankruptcy and whether payments are made. Please be more specific. You may contact me or email clarification
Answered on Aug 20th, 2014 at 6:25 AM