QUESTION
Will I still be co-owner of our home and car if I filed for bankruptcy and didn't reaffirm mortgage but my husband did not file bankruptcy?
Asked on Feb 01st, 2014 on Bankruptcy - Missouri
More details to this question:
I am married and I filed chapter 7 but my husband didn't. I didn't reaffirm the mortgage or car loan. If he pays them off, am I still co-owner? Can the mortgage company keep me from the home after it is paid off?
12 ANSWERS
Bankruptcy discharges debt - it does not change the ownership of exempt property.
Answered on Feb 14th, 2014 at 5:23 AM
Bankruptcy Law Attorney serving Austin, TX
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Law Office of Susan G. Taylor
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Yes, but you can never be held personally liable for any deficiency.
Answered on Feb 11th, 2014 at 3:55 PM
Deborah F. Bowinski
The title on the deed and the obligation on the mortgage loans are two different things. The lender has no control over your joint ownership of the property. The only exception to that would be if the loan became delinquent and the lender went through foreclosure proceedings to gain title to the property themselves. As long as there was no unprotected equity in the property that your bankruptcy trustee sold for the benefit of your creditors, your ownership interest remains as it was before you filed your bankruptcy case.
Answered on Feb 05th, 2014 at 9:20 AM
Yes, you remain the co-owner of both the house and the car. When you reaffirm a debt, you agree to remain liable for that entire debt. But when you reaffirm a debt, that does not affect whether you own the collateral or not. The lender still retains their security interest and their right to repossess or foreclose if you default on the debt.
Answered on Feb 05th, 2014 at 9:20 AM
You are still the owner notwithstanding any Reaffirmation Agreement, if they are paid off. Title to the property does not change, so you are fine.
Answered on Feb 05th, 2014 at 9:20 AM
If you were a co-owner before you filed bankruptcy, you would still be a co-owner afterwards. Of course, you were supposed to disclose your half-interests in those assets in your bankruptcy papers. I assume you did. The mortgage and the car loan are promissory notes and your liability on those notes has been extinguished by your bankruptcy. Those promissory notes are secured by your home and car, and whether you reaffirmed those debts or not, the liens of the creditors against the deed on your home and the title for your car remain in place. Once those debts are paid, the creditors must release their liens against those assets but they would not alter the ownership. Therefore, they can't keep you from the home after it is paid off. If your husband defaults on either loan, however, he would lose the assets through foreclosure of the home or repossession of the car. If you claimed bankruptcy exemptions for your half-interest in either asset, then you would be entitled to half of any proceeds actually received by your husband, up to the amount of exemption you claimed for that asset. Of course, you might have to sue your husband to get your share in that scenario.
Answered on Feb 05th, 2014 at 9:20 AM
2 Awards
Yes, bankruptcy does not remove your name from title to property. Once the property is paid off, you will receive title with your husband.
Answered on Feb 05th, 2014 at 9:19 AM
Your bankruptcy only eliminates your liability on the home and car loans. If you name was on the deed to the house and the title to the car prior to bankruptcy then they will remain after the bankruptcy.
Answered on Feb 05th, 2014 at 9:19 AM
2 Awards
It is most likely that nothing happened with the ownership of the property after the chapter 7, so you are still a co-owner.
Answered on Feb 05th, 2014 at 9:19 AM
As long as the mortgage payments are made and you were able to claim your house as exempt on your Chapter 7, your ownership rights will not change because you filed bankruptcy.
Answered on Feb 05th, 2014 at 9:18 AM
Creditor's Rights Attorney serving Clayton, MO
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Fluhr & Moore, LLC
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You are still the owner, You do not have to pay debt.
Answered on Feb 05th, 2014 at 9:17 AM
Consumer Bankruptcy Attorney serving Worcester, MA
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Law Offices of James Wingfield
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Filing a Chapter 7 bankruptcy case - and even a discharge of your personal liability under the mortgage - does not, in and of itself have an effect on the title to your home. So, the quick answer is no. However, you should keep in mind, if there is equity available to you in the home that exceeds the amount of your available exemptions, then the Chapter 7 trustee could potentially sell your interest in the house, or even both your interest and the interest of your spouse, to a third party buyer. Be sure to work with a qualified bankruptcy attorney before filing any bankruptcy.
Answered on Feb 05th, 2014 at 9:17 AM