Advice on voluntary surrender of home to lender

How much more damage could I do if I just voluntarily surrender my house back to the lender?

I have a dismissed bankruptcy scheduled to fall off my credit in 2010. My house was included in the original bankruptcy as well as an automobile. Once the bankruptcy was dismissed I reached an agreement with the mortgage company to keep the house. However, I had incurred substantial fee's which I had to pay before they would reinstate the loan bringing my home loan basically back to where I started. The house isn't in the greatest neighborhood and I can't qualify for another mortgage, but i really want to move. My credit is horrible right now (under 500) and doesn't seem to be able to get any lower. How much more damage could I do if I voluntarily surrender the house back? It seems like surrendering the house would actually improve my score because my debt would be reduced. Any advice?

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Bill's Answer
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The voluntary surrender of a home in the manner you describe is often referred to as a "deed in lieu of foreclosure" in the mortgage industry. In this procedure, a borrower negotiates with the lender to turn over the deed to the lender in order to avoid formal foreclosure proceedings in the court system. I will explain more about voluntary surrender of a home in just a moment.

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I generally recommend negotiating a deed in lieu agreement when a homeowner can no longer afford his mortgage payments, has explored all other options to save his home, and when foreclosure is imminent.

It sounds like you are able to make your monthly mortgage payments, but that you would like to rid yourself of the home so you can move. Before you consider surrendering the property to your mortgage lender, you should do everything in your power to sell the home. If you can find a buyer, you should be able to rid yourself of the home without the credit damage caused by a foreclosure or a deed in lieu. For further information about foreclosure, you should review the foreclosure information from the Avoiding Foreclosure Web page.

Unfortunately, in the current housing market, many homeowners find themselves owing more on their mortgages than their homes are worth, a situation which the mortgage industry refers to as being "upside down" on a mortgage. Even if you cannot find a buyer willing to pay enough for the home to pay off what you currently owe, you still may be able to sell the property for less than the mortgage balance, though you will need to negotiate an agreement with your lender to accept less than the balance of the note to pay off the mortgage.

Selling a home for less than the balance owed on the mortgage is often called a "short sale." Such transfers must be approved by the lender prior to the sale. Lenders that agree to short sales will frequently forgive any balance remaining on the note after the sale proceeds are applied, though they usually require borrowers to provide documentation of financial hardship, such as job loss or unexpected illness, before they will approve a short sale.

Surrendering your home to your mortgage lender through a deed in lieu of foreclosure agreement will likely have a strongly negative impact on your credit rating and your ability to obtain a new mortgage. While I understand that your credit score is already quite low, it is possible that a voluntary surrender may drive your score even lower. In addition, this derogatory mark on your credit will likely appear on your credit reports for seven years, meaning that this "foreclosure" could damage you credit rating for much longer than your dismissed bankruptcy.

Recommendation

Explore all options available to you to avoid voluntary surrender or foreclosure of your home, as losing your home will likely hurt you financially and negatively impact your credit rating for many years. These credit problems could prevent you from qualifying for a mortgage for a new home, cause you problems leasing an apartment, and force you to pay significantly higher interest rates for any credit you are able to obtain, which could cost you thousands of dollars in interest charges.

To learn more about the foreclosure process, and possible ways to prevent foreclosure, I encourage you to visit the Bills.com Foreclosure page. See also Deed In Lieu Of Foreclosure vs. Short Sale and Home Affordable Foreclosure Alternatives Program.

I hope this information helps you Find. Learn & Save.

Best,

Bill

Bills.com

174 Comments

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  • 35x35
    Feb, 2013
    Emerita
    My husband and I filed for BK last Nov 2010. It was discharged March 2011. Although the house is included in the BK, we continue to pay our monthly mortgage. We owe $410k but the value of our property is only $210k. We are underwater by $200k. We are considering surrendering our house to the lender. What is the best way to do that? Should we do short sale? What is our liability? Are we going to pay taxes? We would appreciate your advice.
    1 Votes

    • 35x35
      Feb, 2013
      Bill
      Based only on the facts you shared, the answer to your personal liability for the mortgage question is, "No, you do not have liability for the mortgage because it was discharged in your 2011 chapter 7." However, if you signed a contract to reinstate your liability, which your lawyer almost certainly would have advised you not to, then the answer to your question is, "yes." Or, if you refinanced, which is unlikely, the answer would be yes. Consult with your bankruptcy lawyer to make certain you have no personal liability for the mortgage before you make any decisions about how to proceed.

      If you have no liability for the mortgage, then you have the option to walk away — allow a strategic default.

      You mentioned a short sale. Because you have no liability for the mortgage, I do not see a legal or financial reason to consider this option.

      You mentioned taxes. I do not see any unusual tax situation here, again assuming your personal liability for the mortgage was discharged in the chapter 7.
      1 Votes

    • 35x35
      May, 2013
      A
      I was in your same situation until I researched my answer and talked with someone at my county court. Yes, I was still responsible for paying HOA dues, taxes, and insurance even after I surrendered my property in a chapter 7 bankruptcy. That was until I found out I could use a Quit Claim Deed (QCD) to get the property I surrendered out of my name. The HOA organization knows if the property is in your name, you are responsible for paying your dues. No attorney will tell you this unless you pay them money to do a QCD on your behalf. Yes, the banks will get angry, but you just want them to take ownership of the property you surrendered. A bank delaying transferring a property out of the owner's name makes the bank avoid responsibility for HOA fees,TAXES, INSURANCE, etc.

      I typed-up my own QCD to transfer the property out of my name into the bank's name, and recorded it with the county Deed and Recording Dept. If you do the same, you will no longer own the property. Be sure to send the HOA a copy of the stamped, recorded QCD so they can pursue the bank to pay the fees.
      0 Votes

  • 35x35
    Jan, 2013
    Cindy
    We started a short sale voluntarily. Because of health problems, I was going to look for a lower paying job because my current one is very stressful. I have already been offered another job with almost the same pay but no stress. Can I stop the Short Sale process and keep our home?
    0 Votes

    • 35x35
      Jan, 2013
      Bill
      Cindy, I don't have enough facts to say whether you can stop the short sale process and keep your home or not. If you've been making your mortgage payments as agreed, then you can stop the short sale process, continue making your payment, and stay in your home. If you are behind on your payments, you need to catch up on your arrears or work out a solution with your lender.
      0 Votes

  • 35x35
    Oct, 2012
    James
    Thank you for posting this information. I am understanding more and more the importance of great vacation homes. The modular homes are what we all need to stay comfortable in this day and age. Keep up the great posts.
    0 Votes

  • 35x35
    Sep, 2012
    James
    My wife and I refinanced our home back in 2005 and then modified it in 2008 only to be reduced $100.00 still to high. In 2007 I went through a short time of unemployment and stuggling. We bounce back for a short time and then we were hit one set back after another, two deaths in the family within 6 months and major vehicle repairs on our 2 vehicles ( No vehicles, No work ). We are five months behind and have tried everything to get relief from our Mortgage Company ( NACA , HAMP , REPAYMENT PLAN, MODIFICATION ,RESTRUCTURE ,SHORT SALE ,DEED IN LIEU FORECLOSURE ) and we are upside down. Our Mortgage Company is not willing to help and has started forclosure process. Would Voluntarily Surrendering Help to beneficial ? ANY ADVICE ?
    0 Votes

    • 35x35
      Sep, 2012
      Bill
      A voluntary surrender could help you, but it could also leave you on the hook for any deficiency balance that remains after the house is sold at auction. You could look into a bankruptcy, as a way of discharging the deficiency balance. You will have to continue making the mortgage payment, if you want to stay in the housw.
      I don't know if you have other debts that you would clear out in BK, giving you greater cash-flow to afford the mortgage payment.
      0 Votes

  • 35x35
    May, 2012
    Joe
    Since January 2012 we trying to sell our house and so far not one showing or offer. We are moving to Europe and can not afford to keep the house here and renting in Europe a place. Our salary here is low and the future salary is low-medium. We thought through different options, including to rent out our house. But what I mentioned before. We can not keep both. To give back the house would be right now the only option. While a ruined credit score would be for us the least problem right now. Any advice?
    0 Votes

    • 35x35
      May, 2012
      Bill
      I see three options for you:
      • Start discussions with your home loan servicer about a a deed-in-lieu-of-foreclosure or a short sale. Both take you to the same place — selling your property — but via different routes.
      • If discussions with your servicer go nowhere, consider a strategic default. This is your nuclear option, as it were, if your discussions with the servicer fail. Before you pull the trigger and allow a strategic default, consult with a lawyer in your state who has experience litigating mortgage issues so that you have an understanding of your rights and liabilities for the deficiency balance.
      • Rent the property, and cross your fingers the rental market in your area is tight enough for you to break-even or better on your monthly cash flow.

      One last thought: Study your state's anti-deficiency rules to understand what, if any, liability you may have for a deficiency balance on your home loan.

      0 Votes

  • 35x35
    May, 2012
    Laticia
    In 2006 my ex spouse and I purchased a home together. He was on the mortgage first and me second. Around June of 2007 I left him and took a lease at another residence. My ex would not leave the house and because of the situation there I felt I had no other option but to leave. We had a verbal agreement that he would pay the mortgage and put it on the market. In lieu of paying the mortgage he decided to pay a private eye to spy on me. Withing in seven months of me leaving him, the house was in foreclosure. He did not maintain the house to where it could be sold. He actually wanted me to come to the house and clean up after him. I want to know if in a situation like that, where I am no longer in residence...my address has changed and the children were attending school in my district could I have the foreclosure removed? He intentionally did everything he could to ruin my credit. Because of a few other shenanigans he did I also have a repossession and three judgements on my credit report. I also found out that he had put credit cards in my name that I knew nothing about.
    0 Votes

    • 35x35
      May, 2012
      Bill
      Regarding the credit cards your ex-spouse opened in your name, I think you have two main options:
      1. Contact the creditor and state that you should not be linked to the account, as you did not consent to be responsible.
      2. Consult with an attorney.

      Regarding the foreclosure and your credit score, it is unfortunate, but as you were financially responsible for the loan, all the delinquencies for the loan and other accounts that you were listed on will appear on your credit report.

      0 Votes

  • 35x35
    Mar, 2012
    Crystal
    My husband did a deed and lieu with BB&T and it finalized back in February 2011 I think. We recently got a letter stating that we owed a huge amount for the foreclosure, we contacted the bank and they said that we had a forclosure. We told the lady no we did a deed and lieu and we had the letter but since we have moved twice being military, we can't find it. There must be a copy of this letter or something proving we did a deed and lieu. They made his credit look even worse and the interest that we apparently owe is huge, this is the first letter we received and it says we own interest for a year. I feel as though the bank is being shady, what do we do to prove that they did a deed and lieu without being able to find the letter they sent saying it went through? Please help.
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      The letter you seek is one small piece of a puzzle that shows what happened. Ask a lawyer in the town or city where the property was located to do a title search on the property. A deed in lieu will appear as a voluntary conveyance on the title, and a foreclosure will, of course, show up as a foreclosure. Ask the lawyer to make copies of the conveyance, and then write a letter to the lender explaining that the evidence shows a deed-in-lieu-of-foreclosure, and that a foreclosure never took place.

      However, doing so will not get you out of the woods yet. Whether you disposed of the property with a short sale, deed-in-lieu, or foreclosure, there is still the matter of the deficiency balance. The lost letter you mentioned may have a clue as to any promise made by the lender to forgive the deficiency balance. Ask your lawyer to demand copies of any and all correspondence the bank sent you regarding an offer of a deed-in-lieu or the deficiency balance.

      Readers, Crystal's letter is a reminder when you go through an important event like a home purchase or foreclosure to keep all related documents in a safe place. Relying on your opponent to keep better records than you is not a safe strategy.
      0 Votes

  • 35x35
    Mar, 2012
    Rico
    My wife and I filed for Chapter 7 on June 11 and it was discharged in August 11. We surrendered our house when we filed. How do we know that we can not longer stay in this house? should there be a notice or something that will tell us that we need to leave? we can not afford the payments to stay here even if we wanted to. Should we wait until we are asked to leave or should we start packing now? Now to make it a little complex, our old lender transfer our loan to a different lender and it just took effect in February 12. what can we do or where can we get advice?
    0 Votes

    • 35x35
      Mar, 2012
      Bill
      Consult with your bankruptcy lawyer to learn how much time mortgage servicers have been giving homeowners in your area. In my experience, your situation is not unique because the mortgage servicers are completely overwhelmed by foreclosures. That said, you should plan to vacate the premises on short notice.
      3 Votes

  • 35x35
    Feb, 2012
    George
    Hello. I have a rental property where I am extremely "upside down," and, just keep having problems with renters. My wife and I are considering DIL, though, the only "hardship" I can cite is that overtime has slowed. Fortunately, my wife and I are blessed with good jobs, but, this property has been a headache.
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      I suggest that you read the Bills.com article about deed in lieu of foreclosure vs a short sale. If you stop payment, then your loan will go into default and you most likely the lender will foreclose on the property and seek the deficiency balance through a court judgment. If you wish to do a short sale of DIL, then you will need the permission of the lender. If you are strong borrowers, the lender will most likely demand that you pay the whole loan, through the sale and a payment plan. You can attempt to negotiate the deficiency balance. Another possible solution is to hold on to the property, seek better tenants, and more security from your tenants. Run credit, employment and past rental history checks on your tenants.
      0 Votes

  • 35x35
    Feb, 2012
    Matt
    My wife and I have a house in NJ that is currently in the process of being sold through a short sale. We have met with bankruptcy lawyers and they have mentioned surrendering the house. If we were to surrender the house, we wouldn't owe any more money on it, correct? Also, if we did do the short sale and it went through, we would owe the difference of what we owed on the house and what it sold for, right?
    0 Votes

  • 35x35
    Feb, 2012
    Robin
    My husband and I filed bk four years ago. We surrendered the property to the lender. The city continues to send us property tax bills and assessments. Are we liable for the taxes?
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      No. Send the city a Certified Letter explaining the facts of the surrender. Name names, and include all details regarding the contact information at the bank or credit union so that the city can follow-up with the appropriate people at the bank.
      0 Votes

  • 35x35
    Jan, 2012
    Heather
    Hi. My husband and I are in the process of moving out of our house. We are now 30 days behind on our mortgage. I found out that when we had our bankruptcy back in 2007 (discharged in 2008) that our house was not "reaffirmed" in the bankruptcy. My understanding is that we are no longer personally liable for our mortgage, and we can walk away from the property. There is approx. $20k in repairs that need done, then even after that, we are about $30k upside down, according to a Realtor that we talked to. My question is, when we walk away, should I: A) Let the bank take the property through foreclosure; or B) Try to negotiate a short sale? My thoughts are that both the bank and us benefit from a short sale. Them due to the costs, and us due to the timeframe. Like I indicated, I know we have no personal liability for the home loan, as it was included in our bankruptcy. Any advice is appreciated!
    0 Votes

    • 35x35
      Feb, 2012
      Bill
      For most home owners, a short sale is superior to a foreclosure. However, if the home owner filed a successful chapter 7 where the home loan was included, then walking away is smarter financially. In a situation like yours, the only advantage a short sale has is that you can control exactly when you vacate the property. However, if you are already moving elsewhere, I see no financial or legal advantages to a short sale.

      Consult with your bankruptcy lawyer to discuss the specifics of your circumstances and your options. You may have additional relevant facts you did not share that would lead you to a different conclusion than the one I shared here.
      0 Votes

    • 35x35
      Feb, 2012
      Heather
      Another thought I have, is would we be better to do a deed in lieu, rather than a foreclosure? A DIL, would make the process much quicker, by getting the property into the banks hands faster, and they save the money on the foreclosure process. I am not sure if this is an option or not. Like I indicated, we are not personally liable for the financials on the property, as it was included in our bankruptcy in 2008. Thanks for your advice!
      0 Votes

    • 35x35
      Feb, 2012
      Bill
      All other things being equal, a deed in lieu of foreclosure is a better deal for a borrower because it places the liability for the property on the lender as soon as the contract is executed. However, in life there is no such thing as "all other things being equal." A good short sale contract is better than a bad deed in lieu of foreclosure.

      In your case, I would be leery of any contract I signed with the lender because it may have language that reinstates the loan or otherwise obligates you to any deficiency balance. Consult with a lawyer before you sign any contract the lender places before you, and ask him or her to review the contract before you sign it.
      0 Votes

  • 35x35
    Dec, 2011
    Nikkie
    Greetings, I just filed for bk which will be discharged in 2/12. We did a "deed in lieu of foreclosure", as we cannot afford the home anymore because my husband has lost his job. My question, how long does it take for the deed to transfer from myself back to the bank. I signed correspondence that I do not want to keep the home and do not wish to renegotiate. We have already moved to an apartment but still need to get 2 big pieces of bulk furniture, what is the time estimate for when the bank actually comes to take possession of the house? Will I need to give the bank the keys or do they even care at this point? Thank you for reading and providing any insight.
    1 Votes

    • 35x35
      Dec, 2011
      Bill
      If you have done a deed in lieu of foreclosure with your lender, that means that after meeting their eligibility requirements and approval, you have signed and notarized all bank papers. You will then have 14 calendar days, or the amount of time specified in local law, to move out of the property. Any questions you have should be directed to the lender, including eligibility for relocation expenses.
      0 Votes

  • 35x35
    Dec, 2011
    Jaylen
    Elegant description has been given. Good justice to the article.
    0 Votes

  • 35x35
    Dec, 2011
    Ja
    I have a question if I may. A company I co-owned was sued in 2007. The plaintiffs came after me personnaly. I had to declare bankrupcty. I opted to keep my house. It originally costs $255,000.00 to build. I had sold a home and put my equity down on this new home. I lived there 4 years priar to this suit. I owed $148,000.00 on the house. The lender started charging me $1,300.00 month in bankrupcty fees every month on top of my payments. I opted to take cash for keys and include it in the bankruptcy to forgo a foreclosure, I surrendered it. They sold it for around $300,000.00 and I did not get anything back. Again I only owed $148,000.00. Should I have at least gotten $15,000.00 back because of the Missouri homestead act? Thank you for your answer.
    0 Votes

    • 35x35
      Dec, 2011
      Bill
      It is not clear to me why you declared bankruptcy with so much equity in your home and why did you not instigate the sale of the property on your own. As you did not state how much you owed from the lawsuit, perhaps you figured that the judgment-creditor would get all the proceeds?

      I am concerned that you did not get an upfront explanation from your bankruptcy lawyer about the effects of filing BK. The homestead exemption in MO is only $8,000, so when your assets were liquidated to satisfy your creditors, only $8,000 is protected. Check with your bankruptcy lawyer, so you have a clear understanding of the exact sums that were owed to the bank and how the funds from the sale of any of your assets that were liquidated were distributed.
      0 Votes

  • 35x35
    Nov, 2011
    Karen
    My mortgage was included in my chapter 7 BK that was filed in Sept., 2011. My BK was dischaged in October 2011. When should i receive a notice of default? Will this have the trustee sale date? I would ike to have an idea of when i need to be out of the house. Thank you.
    0 Votes

    • 35x35
      Nov, 2011
      Bill
      If you wish to remain in the property and can afford your payments, then continue to do so! A bankruptcy in and of itself does not lead to an automatic foreclosure. Your bankruptcy lawyer should have explained this to you. If not, speak to him or her immediately.

      If you cannot afford your monthly payments or otherwise wish to quit the property, then talk to your bankruptcy lawyer about the timeline for foreclosure in your state. Some are brief, and some are not.
      0 Votes

    • 35x35
      Nov, 2011
      Karen
      My BK atty., was the one that told me i would be receiving the NOD but he couldn't give me a definite date. My lender has also filed a Relief of Stay in Sept.
      1 Votes

  • 35x35
    Oct, 2011
    Betty
    My husband and I hold the mortgage on our son's home in Pennsylvania. His living expenses including housing costs are almost double his income since his wife's death in July. He wants to turn the home back to us and we have a friend that told us about a "Deed in Lieu of Foreclosure". Is this viable in PA and is this the best way for us to assume to responsibility and try to sell this fixer-upper? We have agreed to split any profits with him after we clean it out, do minimal repairs/upgrades. The list price of the home on Zillow is about 50% above what he owes us. HELP. We are retired and on a fixed income and cannot afford to have the house empty.
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      Facts in your message confuse me. Are you the lender? Or do you have a bank loan in your name for the property your son occupies? If you are the lender, the contract is between you and your son, and there are no other parties involved, then consult with a lawyer who has contracts or real property experience to mediate any issues you have between you and your son as you conclude your mortgage contract.

      If the loan on your son's home is in your name, then again, your facts confuse me. If the property is worth 50% more than the balance of the loan, then sell the property and pocket the equity. If, on the other hand, the property is worth half of the loan's balance, then your property is underwater. Consider a deed in lieu of foreclosure or a short sale. Call your mortgage servicer to learn more about these two options.

      Before signing any short sale or deed in lieu of foreclosure contract, consult with a lawyer in your state to learn all of the terms and conditions of the deal. In particular, learn how the contract handles the deficiency balance.
      0 Votes

  • 35x35
    Oct, 2011
    tammy
    we had a bankruptcy discharged in april 2009. we are now considering short sale if our lender will accept. we had a loan modification...2 weeks before it was due to be finalized they sold the mortgage to another lender that will not recognize it. they want all money now as they wont recognize the modified pymnts weve been making. we are $55,000 upside down. if we short sale, will we show as delinquent and therefor be subject to 3 yr fha waiting period, or since no pymnts show up, how will the fha people know?
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      If you are never delinquent repaying a loan, then your credit report should reflect that fact.

      In your case, however, it appears you and the mortgage servicers never signed a contract to modify your loan. If I understand you correctly, you started making different monthly payments as if the contract was signed by you and the mortgage servicer. If that is the case, and the modified monthly payment is less than you should be paying, then you should expect derogatories to appear on your credit report.
      0 Votes

  • 35x35
    Oct, 2011
    Jason
    We are seriously considering walking away from our home that we bought in 2005. Just like everyone else in the country, our house is worth MUCH less than we are paying. There are many houses in our neighborhood for sale for many years and they are unable to sell for less than $40,000 and we would have to sell ours for twice that to simply get out of it. To add to the complication the area we live in is getting dangerous. We cannot even let our kids go to the park without being pressured from drug dealers, kids with firearms, etc. We have put about 40k into this house and don't want to put anymore money into it because we won't get any return. We are thinking about walking away, renting for a few years and then buying using my VA benefit in a city where we spend most of our time anyway. Is it really that simple? Unsure of what to do. I need to take care of my families safety first!
    0 Votes

  • 35x35
    Oct, 2011
    Vera
    My parents who are close to 80 years old filed Chapter 7 in California earlier this year, but home was not included. They can (but barely) afford mortgage payments which are almost 2/3 of their monthly income. They are scraping by to buy food, pay utilities. Is surrendering the house or short-sale a good option for them? They should have included the home when they filed bankruptcy but their pride told them to try to hang onto it. Their current mortgage is probably over $100K than what the house is worth in the current market. Your input would be greatly appreciated.
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      I advise you and your parents to contact their BK attorney right away, to discuss reopening their BK case.

      According to Bankruptcy Code Section 350(b), the bankruptcy court can reopen their case to "administer assets, to accord relief to the debtor, or for other cause."
      0 Votes

    • 35x35
      Oct, 2011
      Vera
      Thank you so much for your input. I will tell them to contact their attorney that helped them file. I really hate seeing them live the way they're living. I also can't believe their bank was able to convince them to refinance as many times as they have, knowing they are on a fixed income.
      0 Votes

  • 35x35
    Oct, 2011
    Christine
    My husband and I filed a chapter 7 bankrupcy in 2007. My home was included. We worked very hard for the last 2 1/2 years to keep our home. We attempted to do a loan modification. We decided to be responsible and short sale it even though we knew we were not obligated in any way to do so. 10 days before the house was to close escrow Wells Fargo decided to file a notice of default against my husband and myself. Are they allowed to do that since this house was included and discharged in a bankrupsy? I thought they can only go after the property and not after me or my husband personally. It is now causing credit issus for us. What should we do? We have tried to get a letter from them to explain why this occured with just a run around and no one willing to figure this out. Please give us some advice. Best Regards, Chris
    0 Votes

    • 35x35
      Oct, 2011
      Bill
      Consult with your bankruptcy lawyer about this issue immediately. I fear you may have unknowingly reinstated your liability for the mortgage in the short sale process.

      If you cannot reach an agreement for a short sale, the creditor has the option to foreclose. The chapter 7 stripped your personal liability for the note portion of the bundle of rights we call a mortgage, but did not remove the creditor's right to foreclose.
      0 Votes

    • 35x35
      Oct, 2011
      Chris
      I was told only the judge could reinstate or re affirm the debt. The judge didn't reaffirm it. Are they allowed to file a public recorded notice under my name even after it was discharged and cause me additional credit issues? They have tarnished me twice. Once with the bankruptcy and then again with a public notice. What should we do?
      0 Votes

    • 35x35
      Oct, 2011
      Chris
      They filed the notice 10 days before the house closed escrow. I didn't know about it until afterwards.
      0 Votes

    • 35x35
      Oct, 2011
      Bill
      You are correct. Following the enactment of the 2005 amendments to the bankruptcy code, your lawyer must complete a lengthy reaffirmation document in which he or she asserts you can afford the reaffirmed payment and that it is in your best interest to do so. However, my experience with mortgage servicers in short sales has made me believe one would not be above trying to add a reaffirmation contract that may not comply with the BAPCPA amendments into a short sale document stack. Let us assume you did not reaffirm your mortgage.

      Do not assume the mortgage servicer reported your bankruptcy to the consumer credit reporting agencies. It is likely the consumer credit reporting agencies received a notice of your bankruptcy discharge from the court directly. Regardless, if the mortgage servicer was the party that reported the bankruptcy, it was still an accurate report, which is allowed under the FCRA.

      Inaccurate derogatories appearing on a credit report can be disputed. However, if the foreclosure is pending, it is unlikely that a dispute will be successful.
      0 Votes

    • 35x35
      Oct, 2011
      Chris
      Thank you for this information. Very helpful. No pending foreclosure because the house sold. They did however file a cancellation of the notice of default. Not sure why they filed it to begin with. They did so 10 days before it closed escrow. It feels like they did it purposly. I am just not sure if they are allowed to file a public notice on me when it was included on my bankrupsy?
      0 Votes

    • 35x35
      Oct, 2011
      Bill
      Was the derogatory accurate? If yes, then a creditor did not violate the FCRA. If no, then it did. If the report is inaccurate, dispute it. If there is evidence the report was malicious, then you have an excellent case against the mortgage servicer under the FCRA.
      0 Votes

  • 35x35
    Sep, 2011
    Ruth
    Our Chapter 7 was discharged in May 2006. Our house was part of the bankruptcy, the mortgage company filed a Relief from Automatic Stay. January 2008 the sewege company has filed judgements against us for tap in fees that took place after we moved in 2006. Can they do this?
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      It is unclear to me if the unpaid fees that gave rise to the municipality's lawsuit occurred before, during, or after your bankruptcy. Regardless, consult with your bankruptcy lawyer about this matter. He or she will look at the timeline, and can advise you accordingly.
      0 Votes

  • 35x35
    Sep, 2011
    sharon
    hi, my husband died last year so the morgage was transfered straight to me. i put the house on the market but have not made any payments as i do not live in the house anymore... the bank now want me to hand the keys back. any other options ??
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      Please reread the original answer above, and in particular, review the section titled "Recommendations." A short sale or deed in lieu of foreclosure might be smart choices for you.
      0 Votes

  • 35x35
    Sep, 2011
    Lorrie
    We own a small condo on a beach that took serious hurricane damage three years ago. As a result the units are usable, but not really salable due to the issues with the beach erosion and state government regs. We have tried renting. Restrictions won't allow short term rentals. Our income level is down significantly due to economic down turn. I realize that most people don't have a second home and that there will be little sympathy toasted someone who feels overwhelmed with a mortgage of $1700 per month on this, in addition the monthly condo fees have gone from $300 to $600 in the same three year time period. Our business depends on our small business clients who have all cut back over the past couple of years. We are trying to do the right thing, but this seems like pouring money into a big black hole.
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      I assume your condo is worth a great deal less than when you bought it. If so, you have four options:
      1. Status quo
      2. Short sale or deed in lieu of foreclosure
      3. Short refinance
      4. Foreclosure

      The short refinance will allow you to keep the property, but at a lower monthly payment, and is the first option to review. A short sale is a more graceful exit than a foreclosure.

      0 Votes

  • 35x35
    Sep, 2011
    lauraq
    My husband & I filed bankruptcy a year ago and our mortgage company did not reaffirm (just found this out) if we let them foreclose will that show on our credit report even though it was included in our chapter 7 and they didn't reaffirm?
    14 Votes

  • 35x35
    Sep, 2011
    Rose
    I am in active Chapter 13 from May 2009. I surrendered my home to the mortgage company in bankruptcy, but the mortgage company keeps harrassing me for payment, filed public foreclosure, sold the mortgage to another bank, and reports to credit bureaus monthly that I am not paying them. How can they do this and it not be a violation of stay and how to I know from bankruptcy paperwork if the home was officially surrendered ? My attorney just wants more money to file violation suit against this mortgage company, but I need to know all the proper papers have been filed to prevent this from being a waste of my money again. This home was built on non-perc soil and had no potable water consumption, and the value was zero per apprasial so I had to file bankruptcy because I was up to refinance a ARM and had NO value on the home. I was in a legal battle for over 4 yrs with it and forced to arbitrate due the seller attaching a home buyers warranty to the sale of the home. Is there anyway out of this horrible mess? Thank you, Rose
    0 Votes

    • 35x35
      Sep, 2011
      Bill
      Consult with your bankruptcy lawyer to learn if you can convert to a chapter 7 bankruptcy.
      0 Votes

    • 35x35
      Sep, 2011
      Rose
      They have said I make to much income for Chapter 7? Is there Anything else I can do? Sincerely, Rose
      0 Votes

    • 35x35
      Sep, 2011
      Bill
      Consult with your bankruptcy lawyer to learn your alternatives.
      0 Votes

    • 35x35
      Sep, 2011
      Rose
      I consulted an attorney, and I learned that although I surrendered my home with chapter 13, the mortgage company was granted a relief of stay and they foreclosed, have been granted the right to harrass me, and have reported to credit bureaus each month that I am not paying even after they sold the home. I filed bankruptcy and surrendered the home as a method to not foreclose, but now I have both bankruptcy and foreclosure on my credit report. Is there anyway to get a loan for a home now? I lived in the home without potable water for almost 5 yrs, but could not remain there when sewage stood on top of the ground at my front and back door. I did not know what else to do? Any suggestions would be appreciated,
      0 Votes

    • 35x35
      Sep, 2011
      Bill
      Your statement implies the derogatories you mentioned — the bankruptcy and foreclosure — appearing on your credit report are accurate. A bankruptcy will appear for 10 years from the date of the final order. A foreclosure will appear on your credit report for seven years from the date of the entry of the foreclosure judgment.
      0 Votes

  • 35x35
    Aug, 2011
    Clint
    Hello Bill, My wife and I filed chapter 7 bankruptcy in Dec. 2010. My attorney advised us that we would not reaffirm the mortgage so we will have the option to walk away without any repricussions other then seriouse damage to our credit scores (understandable). Because of a loss of income (not employment) is why we had to file (worked for a mortgage company that disolved all commission pay when commission pay made up 60% of my income. I know longer work their because of this). I am employed with another company but still not making what I made when we were living comfortably and able to pay all bills. Now, because we did not reaffirm our mortgage in the bankruptcy we are planning on walking away, we tried working with the bank to see if they would work with us and they declined. Regardless of them declining I would like to know what I should be aware of when we walk. I want to call the bank to tell them the house will be empty, will we be responsible for taxes? property codes from the city (if grass gets too long), will the bank try and stick us with insurance payments(homeowners insurance is escrowed and we have not made a house payment since Oct 2010). I just would like to make sure nothing hits us in the future upon walking away other than our credit scores. Please advise and thank you. We live in Michigan and the house we are walking away from is in Michigan as well.
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      This is a difficult question to answer for everyone in all states, because each state handles your type of question differently. Under English common law, which is what all but one of the US jurisdictions follows, the moment the mortgage servicer is notified that the borrower has quit the property, the lender becomes responsible for all of the expenses you mentioned. However, the devil is in the details, and your safest course of action is to consult with a lawyer in your state who has real property experience to learn the definitive answer, if there is one, for your state.

      I realize my answer is not what you were seeking. However, I would rather provide a sincere non-answer than a guess.
      0 Votes

    • 35x35
      Aug, 2011
      Clint
      Thank you Bill. You have at least provided some direction. Sincerely
      0 Votes

  • 35x35
    Aug, 2011
    Andrea
    We filed chapter 13 after husband lost his job, included in our bankruptcy was an unoccupied rental property, The lenders refuse/ will NOT take over the property and say we're responsible for finding a buyer, our insurance dropped us after a vandalism/theft and small fire to property,(all this mess happened months after bankruptcy discharge)even though we received insurance payment for damages we can't fix the property because lender refuses so sign the insurance checks, now, we're stuck with city code violations, demolition letter,unable to get another insurance. I though I was protected from this mess in chapter 13
    0 Votes

    • 35x35
      Aug, 2011
      Bill
      Consult with your bankruptcy lawyer about the conduct of your mortgage servicer. You may have a cause of action against the servicer for waste.
      0 Votes

  • 35x35
    Aug, 2011
    RENEE
    I have been try to get help with my mortgage but no can help. I can get no help from any of the govement funding to save my home because they say I have rental property. But the rental property are emptly an their going in to foreclosure and I'm going do a Deed In Lieu. So I can get some help to save my home. I don't know if I can even get a loan modifly because I don't make that much money only a $1000.00 a month I've been look like crazy for a job be I can't find one so I'm working part-time I really want to save my home My bill come up to $2400.00 a month so you see i'm in bad shape and this been going on sent 2009. My mortgage on the rental property is so high I can't get any one to rent it one is $1250.00 the other is $1175.00 so I have never been able to make any money on them . I was talk in to buying them at the end of 2008 and was told I would be able to refinance them at a lower interst rate in 2009 but at end of 2009 I loss my job and I haven't been able to get on my feet sent. I'm so full and suicde is looking good no one could have ever to me I would be in this shape I always was a person that pay my bills on time I did pretty go for myself now look a me!!!!!!!!!!! thank you
    0 Votes

    • 35x35
      Aug, 2011
      eve
      Hello Renee S I read your plea. I am not a Lawyer or a counsler just a very concerened citizen! I know your pain you are enduring and I am very sorry, I know far to well the pain it is to lose a home!!! We just went threw the loss of 2 family members, our home, our vehicles... Yes, I do greatly understand. Well the reason I felt the need to responed is to maybe if nothing else give advise. Remember everything we have can not go with us and something I learned is "YOU NEVER SEEN A HURSE PULLING A UHAL" it can't go with you!!! It's hard when your going threw BIG issues in your life but don't give up... The one thing I thought of is have you tried filling a chapter 7? then all they can do is take your rental's but they have to leave you in your current home??? Well I hope you do not give up and I pray it will all work you!!! Best of Luck stay Strong...
      0 Votes

    • 35x35
      Sep, 2011
      alex
      Don't you dare think of killing yourself over some bills and a house. If Donald Trump can file bankruptcy, so can you. Get a fresh start and you will be in another home in two years. let the houses and all of the stress go. Find yourself a place to rent and file ch.7. If the mortgage companies and banks who got all of that money, don't want to work with you let it all go. Stop trying to hold on to stuff you can't afford. Go rent yourself a place to live now and then file ch.7.
      0 Votes

  • 35x35
    Jul, 2011
    April
    My ex-husband and I have both moved out of that home to separate different residences. The home has been on the verge of foreclosure for several years but the bank just won't do anything about it. We have attempted a voluntary surrender, but the bank says they do not accept that. We must list it for sale for at least 3 months before they will do anything. We were not able to maintain homeowners insurance on the property, so the bank opened their own policy charging us, but we are still unable to pay. We qualify for either Chapt.13 but more likely 7 each independently. The house is in disrepair, and is now in major county code violations that we are now being told are criminal. The house was vandalized after we each moved out, but the insurance company the mortgage company hired, will not repair the home until we contract and pay for the contractor. There is no money, the bank won't take the house, we are living in separate states, not in the home, and we are now being threatened by the county that we could end up in jail if we do not bring the home up to code and pay their fines. What recourse do we have to give the house back to the bank? We know our credit will be destroyed. That is the least of our problems at this point. We just want off the house so they can repair it and sell it for whatever amount they can get out of it. There is no equity at all. Please if anyone has any suggestions as to how to handle this? Can the bank say NO to a voluntary surrender?
    5 Votes

    • 35x35
      Sep, 2011
      Heather
      I am having the SAME problems. I surrendered my home in Chp7, which was discharged in July 2010. The bank still hasn't taken the deed over and I'm getting bills, fines, taxes, etc. My attorney said to take my discharge paperwork down to the county clerk office to get my name removed from the deed, but that didn't work. Waiting for more from my attorney, but i'm getting anxious.
      0 Votes

    • 35x35
      Sep, 2011
      Bill
      Ask your lawyer if filing a quiet title action is a viable option for you in the circumstances you described.
      1 Votes

    • 35x35
      Sep, 2011
      Heather
      Thanks for such a quick response! Is Quiet Title Action useful for forcing the lender to take the deed, not just to claim ownership? Most of what I read on it sounds useful if I'm trying to claim ownership, which I don't want. (Waiting for response from own attorney as well.) Thanks again!
      0 Votes

    • 35x35
      Sep, 2011
      Bill
      A quiet title action is a general-purpose tool used to resolve questions regarding real property titles. Lately, it has been used to determine if mortgage lenders have a right to foreclose on property. It can also be used to resolve adverse possession questions, lot-lines between properties, and so on.
      0 Votes

  • 35x35
    Jul, 2011
    Mike
    My wife and I filed for bankruptcy in 2010 and it was discharged in 2010. We did not inlcude our primary residence at the time. What are the ramifications giving the house back to the bank after bankruptcy? Even though we are under bankruptcy protection will the bank have recourse?
    0 Votes

    • 35x35
      Jul, 2011
      Bill
      A bankruptcy filing must contain a complete disclosure of all assets and liabilities. I would be curious to learn how you filed for bankruptcy and did not include your home loan. I think what you may mean is that you elected to retain the property in your bankruptcy filing. If so, the key question is, "Did you reaffirm the mortgage?" If you reaffirmed the mortgage, you have personal liability for the mortgage note. If you did not reaffirm the mortgage, then you do not have personal liability, and you can allow a foreclosure without concern for any deficiency balance.
      0 Votes

  • 35x35
    May, 2011
    Jaciee
    actually have two questions? After we file bankruptcy our daughter offered to buy us a small house will she be able to do this for us? Also Her and her husband bought us as well as his parents tickets for a family cruise. The tickets were made in everyones name. What will happen to our tickets if we file for bankruptcy? we live in ny
    0 Votes

    • 35x35
      May, 2011
      Bill
      Two questions, two answers:
      1. If a homeowner or landlord offers you to stay rent-free in a property they own, the bankruptcy trustee will have no recourse or response. However, if someone gifts property to you in the midst of your bankruptcy process, you must disclose this to the bankruptcy trustee.
      2. The cruise tickets question is tricky. You mentioned the tickets are in your name, which gives you the right to board the ship. However, let us say for the sake of argument that you decided to not attend. If you return the tickets for a refund, would the cruise line issue a refund to you or the person who bought the tickets? If you get the refund, it is fair to say this is your asset, and is one that must be included in your bankruptcy filing. If the ticket purchaser gets the refund, then you can argue it is not your asset because you cannot liquidate it.

      My analysis of the ticket issue is superficial. Consult with a bankruptcy lawyer who will research the case law on this issue further.

      0 Votes

    • 35x35
      May, 2011
      Jaciee
      thanks for responding. I will clarify a bit. first the home issure was after all is said and done my daughter invited us down to stay with her while we find somewhere new to live. They offered to either buy us a mobile home near them or just give us the money to buy a mobile home near them in one of the retirement parks. this is after the bankruptsy is over not during. the cruise tickets were paid by them with there credit card and a refund would be issued to only them. we didnt pay or would expect to get money that wasnt ours. thank you so much
      0 Votes

    • 35x35
      May, 2011
      Vickie
      We filed a chapter 13 01/13/11 which included surrendering of our house. Our plan was confirmed 3/24/11. We just received a letter from the mortgage co's. attorneys. I am assuming they are requesting relief from the automatic stay and that it has been, or will be granted. Is there anyway to know how long it takes now for the next step in the foreclosure process? They had started it previously and a court sale was scheduled but filing put a halt on that. We have moved out, but our son who had been living with us is still in the house and we do still have a few things to move out. I am trying to get a time-line or basically, how much time we still have left before the house will have to be vacated. Also, I read that if there is a sale, and the new owners pay in full, that they can ask for the house to be vacated and the sheriff comes to tell you to go. How many days, or how much time do you have if that happens? Thanks for your help.
      0 Votes

    • 35x35
      May, 2011
      Susan
      I am in a Chapter 13, have had income go from 3200 a month to 2020. The 3200 a month was from my long term disability plan, the 2020 is my social security disability payment. Long term has been cut to zero effective 5-23-11, This reduction will not allow me to stay in my home. I know SSDi does not "count" as income on a means test. I want to continue with the chapter 13 and "surrender my home"...I am just not sure of the correct path to the surrendering of the home. Can you lay out the different scenarios for me. I did receive a lump sum from SSDI(5 figures), does this count or have to be factored in to modifying a chapter 13? I was wondering if I should do a conversion to a 7 or stay in the 13, as it would apply to the lump sum, which chapter would allow me to keep this lump sum? Thanks
      0 Votes

    • 35x35
      May, 2011
      Bill
      Did you do your Chapter 13 on your own? If not, consult with your attorney. If you did file for the Chapter 13 on your own, seek a free consultation with an experienced attorney. I don't want to weigh in on your specific question, for fear that you could suffer harm if I were to answer incorrectly. An attorney will be able to answer each of your very reasonable questions about the implications of your income reduction, the lump sum disbursement, your desire to surrender your home, and the kind of bankruptcy that will best allow you to achieve your goals.

      Once you get an authoritative answer, please report back and share what you learned.
      0 Votes

    • 35x35
      May, 2011
      Bill
      The answers to your questions depend on where you live. There will be issues of legal jurisdiction that will determine how long you have before a sheriff can compel your son's exit.

      How busy the court system is in your area will also have an impact on the timing. In some areas, there are so many people in your situation that the process is bogged down and taking longer than normal. If you used a bankruptcy attorney, consult with him or her for an opinion on the questions you raised.
      0 Votes

  • 35x35
    May, 2011
    Sharon
    My husband and I filed chapter 13 in 08...Our case was affirmed in July. We are currently paying 60% of our unsecured debt back and did not include our home in with the chapter 13. We have never been late on our mortgage and we can afford the payments however I have lost my job and we now have 2 children that were not here when we filed in 08. My question is that we are currently about 30k upside down in this house and my husband bought this house right after his divorce so it is basically not built for a family of 4. It is very unsafe as it has very steep stairs and the bedrooms are upstairs. We had a friend lose a child because their child fell down stairs like these so we are ready to surrender the home. We have ammended the plan and are in the 30 day waiting period. What are the chances that this will go through? We really want out of this house and never had to do this before. We want to rent before it shows up as late on our credit report? Any suggestions?
    0 Votes

    • 35x35
      May, 2011
      Bill
      Consider a short sale or deed in lieu of foreclosure before rushing into a foreclosure.

      You asked about the chances of your mortgage being added to your Chapter 13. Your question is very fact-dependent, and a better person to ask is your bankruptcy lawyer.
      0 Votes

    • 35x35
      May, 2011
      Sharon
      Can the bank or bankruptcy court reject your request to surrender your home if you have ammended your bankruptcy? We do not want to go through the hassle of a short sale or deed in lieu because our bank said that in order to do the deed in lieu home had to be on the market for 3 months and then we have to go through an approval process and that it might not necessarily go through. We are not only 30k upside down this is a 100 year old house and would need probably 10-15k of repairs before we could even consider selling it and we simply don't have that kind of money to sink into the money pit if you know what I mean. Ammending the plan seems like the best and cleanest way for us to get out of this unscathed other than our credit score which at this point really don't want to buy another house for quite a while anyways... So I guess just wanted to see if they could decline this request and also how long does it take once we have filed the ammendment to be able to move out of our house into a rental that is safer for our toddler.
      0 Votes

    • 35x35
      May, 2011
      Bill
      The best authority to answer your questions is your bankruptcy lawyer. He or she has all of the facts at hand, and can answer your questions more precisely.

      There seems little point to adding a mortgage to a Chapter 13 if your plan is to default on the mortgage and allow a foreclosure. A person in a Chapter 13 plan can, under some circumstances, convert to a Chapter 7 liquidation. Adding the mortgage to the Chapter 13, and then converting to a Chapter 7 would be the cleanest approach for you to remove liability for the mortgage. Again, your lawyer is your best adviser.
      0 Votes

    • 35x35
      May, 2011
      Sharon
      Well besides the fact that our bankruptcy attorney never returns our calls to answer questions just wanted to get an outside opinion. We can't file chapter 7 because we exceed the median income with my husband's income or we would have gone that route obviously. I just didn't know if they could reject our request...I guess we will just wait and see as our attorney has been allusive since we started this process 3 years ago. I have never seen someone not return an email or phone call like he does. This has been a very frustrating process and just can't seem to get a straight answer from him. Thanks for your help.
      0 Votes

  • 35x35
    Apr, 2011
    Sallie
    In 2000 I got into a FHA mortgage with my mother. Both of us are equally on the loan. I was 20 years old when I did this. Did this because my mother's credit wasn't good enough by herself. We are trying to sell for a few reasons. We noticed about 5 - 6 years ago that the ground the home is sinking in several places, huge holes. We've had those areas filled with dirt and they keep coming back. There seems to be some wiring problems that go away and come back and several electrical companies can't seem to find the problem. Also, my job is moving almost 2 hours away and I don't want to drive back and forth so I'm wanting to find a place closer to my job. My mother cannot afford the mortgage on her own. For 2 years we tried to sell, but no offers and therefore it has been off the markert for over a year now. We are current on the mortgage payments. What are our options, if it want sell? I think that in order for it to be in foreclosure you have to be behind in payments, right? We want to save our credit if possible. Both of us are in the high 700's. Will our mortgage company, Wells Fargo, take it back and how will it affect our credit?
    0 Votes

    • 35x35
      Apr, 2011
      Bill
      See the Bills.com resource Georgia Mortgage Foreclosure to learn more about alternatives to foreclosure in your state. Also review the original answer above for two other resources to help you understand alternatives to foreclosure.

      You asked about the impact foreclosure and short sales have on credit scores. The answer is "terrible." See the Bills.com resource Short Sale, Foreclosure & Your Credit Score to learn more.
      0 Votes

  • 35x35
    Mar, 2011
    Doris
    My husband and I are struggling so hard to keep up with our mortgage. We are living day to day trying to make ends meet. We have tried to sell our home 3 times with no success because of economy. We were put on a modification program. Our mortgage is up to date. but we have $26,000.00 owed in escrow. Can't keep up with taxes, which they end up paying for us. They are a very forgiving mortgate co. and have really worked with us. We called the mortgage co. in reference to a deed in Lieu. They said they we could surrender our home and would be released of any costs involved. They also said they have a policy of returning $2500.00 back to people who do surrender. Does that sound correct to you?
    0 Votes

    • 35x35
      Mar, 2011
      Bill
      Do you have ANY equity in your home? While I understand that you have tried hard to sell your home, have you dropped it to the lowest price that would still cover paying off your mortgage and your tax arrears? If not, I think that is the first option.

      The $2,500 offer sounds like a cash for keys offer. It likely will involve a written agreement between you and your lender that specifies the amount that will be paid to you, as well as the time-frame for vacating the property and the binding commitment for you to leave the property in excellent shape. Cash for keys is a negotiation. You should aim to cover your costs for relocating. If $2,500 covers that, it may be best to accept their offer, though I don't see any harm in asking for a bit more, especially if you need it to move and find a new place.
      0 Votes

    • 35x35
      Mar, 2011
      Doris
      There is no equity, we owe almost $185000 on the mortgage. We just found out thru tax evaluations in our township that house would only see for about $100,000. Thank you for your help..
      0 Votes

    • 35x35
      Mar, 2011
      Bill
      When it comes to guessing the market value of real property, ignore the county tax assessor's valuation. Instead, either pay for an appraisal, where an appraiser inspects your home and compares it to similar homes in your area, or use a Web site like Zillow.com to find a computer-generated estimate.
      0 Votes

  • 35x35
    Nov, 2010
    my Chapter 13 bankruptcy uncluded a rental home. I am not behind in the payments and have a renter. When I notify the lender- how long will it take for them to take it back? in otherwords, how long will my renter have before she has to move out?
    0 Votes

    • 35x35
      Nov, 2010
      Bill
      The renter may not need to vacate the premises if the property is cash-flow positive. Let me put it this way, which is more valuable, a property that is cash-flow positive or one with no tenant? That said, consult with an attorney in your state to learn if there are any state laws on point. See also the federal law Protecting Tenants at Foreclosure Act of 2009 for more.
      0 Votes

  • 35x35
    Nov, 2010
    Lorraine
    My husband and I could not afford an attorney to complete the bankrupcy filing for us so we did it ourselves. The bankruptcy was discharged. Our home was included in the Chapter 7 bankruptcy. We have not heard from the bank yet in reference to the next step. I would like to know, if you surrender your home in bankruptcy how long do we have before we have to move out? Also, my husband has an accident case pending...the attorney has not yet provided to the insurance company (at fault client)a demand letter. We don't know if it will go to court. Prior to the bankruptcy being discharged, the bankruptcy trustee notified creditors of the possible settlement and gave a deadling as to when claim requests were to be provided. However, before that deadline the bankruptcy was dismissed. Does this mean that all is clear for us in regards to any settlement my husband may receive in the future?
    0 Votes

    • 35x35
      Nov, 2010
      Bill
      Some words in law have precise meanings. Was your bankruptcy dismissed or discharged? You used both terms to describe the outcome of your case so I am confused if your pro se filing was a success or failure. If your case was dismissed, then there is no point in discussing your bankruptcy because this filing never succeeded. If your creditors were notified of a possible windfall, then if the creditors are smart they are standing by to learn if they will see some of the windfall. However, if the debts were discharged and the final order given, then it makes no sense for the mortgagee (the mortgage lender) to wait. My guess -- note that word choice -- is that the mortgagee is overwhelmed by foreclosures and borrowers filing bankruptcy and simply has not gotten around to your file.

      Mortgage servicers are overwhelmed by foreclosures and bankruptcies, and as we have seen in the news are cutting corners to try to catch up, which will result in even more delays when these tactics come to light.
      0 Votes

  • 35x35
    Oct, 2010
    Melanie
    My husband and I did a pro se Chapter 7 earlier this year and received a discharge from the court in June. We surrendered our house and listed it under the bankruptcy since my husband became unemployed and there was no way we could afford the payments. Chase filed a motion to have the stay lifted, and the house went up for auction the end of July but didn't sell. To protect ourselves we had kept insurance on the house until we knew for sure it was back in bank hands, and only recently canceled the coverage. This week we received a notice from Chase saying that they had received notice that we no longer had insurance on the house, and if we didn't get it covered, they were going to get coverage and have it charged to us. We have not lived in the house in over 6 months and since my husband is still not employed, paying $700 for insurance for a house we're not living in isn't something we can really afford. I'm not sure what to do at this point, and if we have to now get an attorney....well, its not something that is exactly in the finances either. Recommendations???
    0 Votes

  • 35x35
    Oct, 2010
    Bill
    I think the word "chutzpa" describes the bank's behavior. The bank cannot have it both ways -- both the right to auction the property (possession and power to sell) and also demand you have liability. Consult with an attorney in your state to determine if what the bank is demanding is supported by statute or case law. If, as you suggest, you cannot afford an hour of an attorney's time, call your county bar association and ask for the name of the organization that provides pro bono counseling to people with no or low income. Make an appointment with that organization and bring all of your bankruptcy documents and the letter from your bank. The attorney you meet with will be able to advise you according to your state's rules.
    0 Votes

  • 35x35
    Oct, 2010
    Sam
    For the last 9 months we have been working with Wells Fargo to modify our loan. We recently have been told we do not qaulify for a modification. In that time we were not making any payments since we could not afford to and that was the reason for contactin W.F. for assistance. Two weeks after receiving the letter that we did not qualify for the modification we were served with a Summons of Lis Pendens. At the time we decided with the unsecured debt we had,repairs we could not afford and the upside down mortgages with Wells Fargo and BOA, we had no choice but to surrender. It was a difficult decision but we walked away. We responded to the Court and to the attorney representing Wells Fargo of our decision and we moved. Here is where the problem comes in...we know that the best solution at this point would be to file a Chapter 7; however, I had to file a Chapter 7 5 years ago because I had stock in a family business that bankrupted. I had no personal debt at the time but in order not to be sued I was advised to file a Chapter 7 along with the other owners. Should my spouse go ahead and file the Chapter 7 and I wait and see what Wells Fargo and BOA do? BTW we are still current with the 2nd mortgage even though we have walked away from the home. What should we do at this point...should my spouse file the Chapter 7...do I continue to pay the 2nd mortgage? We know there will be a deficiency and we are worried.
    0 Votes

  • 35x35
    Oct, 2010
    Bill
    First, let us discuss the earlier bankruptcy. According to the Administrative Office of the U.S. Courts Web page Discharge In Bankruptcy, "The court will deny a discharge in a later chapter 7 case if the debtor received a discharge under chapter 7 or chapter 11 in a case filed within eight years before the second petition is filed. The court will also deny a chapter 7 discharge if the debtor previously received a discharge in a chapter 12 or chapter 13 case filed within six years before the date of the filing of the second case unless (1) the debtor paid all 'allowed unsecured' claims in the earlier case in full, or (2) the debtor made payments under the plan in the earlier case totaling at least 70 percent of the allowed unsecured claims and the debtor's plan was proposed in good faith and the payments represented the debtor's best effort. A debtor is ineligible for discharge under chapter 13 if he or she received a prior discharge in a chapter 7, 11, or 12 case filed four years before the current case or in a chapter 13 case filed two years before the current case." (See § 727 of the Title 11 bankruptcy code.) Therefore, you yourself may not file for bankruptcy for another three years.

    You use the word "we" when referring to the mortgage. Is the mortgage joint, in your name, or your spouse's name? If the mortgage is in your name only, then I do not see Chapter 7 as an option as discussed above. However, if the mortgage is joint or in your spouse's name only, then it is possible for your spouse to file a Chapter 7.

    You and your spouse should consult with an attorney who has experience in bankruptcy to discuss your options. He or she will review your mortgage documents to determine who has liability, and if that liability can be discharged in bankruptcy. Before you file, however, open a negotiation with the mortgagees and explain that you have consulted with a bankruptcy attorney and are prepared to go that route. State you would rather not file for bankruptcy, and would rather negotiate a settlement. If the mortgagees are not willing to negotiate a reasonable settlement, then your spouse should consider filing for bankruptcy if that is an available option.
    0 Votes

  • 35x35
    Sep, 2010
    Bill
    Consult with your attorney to make certain the property was included in the bankruptcy. If so, make certain you did not reaffirm the mortgage. Double check with your attorney to make certain you have no personal liability for the mortgage. If you do not, you can walk away from the property. If you do have liability, then a short sale would be a wise course of action.
    0 Votes

  • 35x35
    Sep, 2010
    Nana
    I filed chapter 7 bankruptcy in 2009, I included the property and received a discharge but I did not filed the "surrender property" forms with the chapter 7, I just included the property as part of the filing. I am now eight months past due on my mortgage payments and the property is in foreclosure. the property value is now one third less from the original value. After I received the discharge I pay for all my living expenses in cash and my $700 weekly paycheck is the only source of income for my family of three. I live in California, my question is: will a shortsale be a better option for me now or should I just call and inform the Lender that I am not able to continue making any mortgage payments on the property and move out.
    0 Votes

  • 35x35
    Sep, 2010
    BILLY
    My wife and I filed Chapter 7 in 2005. We included the house that we lived in and moved out as soon at the bankruptcy was discharged. The deed to the home has never been transfered out of our name. We keep getting notices from the city because the home is now in horrible condition. The house will be demolished by the county and we will be responsible for the cost. How is this possible?
    0 Votes

  • 35x35
    Sep, 2010
    Bill
    Was the mortgage for the house in question included in the bankruptcy? Did you notify the mortgagee (the bank or loan servicer) that you intended to surrender the property as part of the Chapter 7? Did you reaffirm the mortgage? Consult with bankruptcy attorney, who will ask these questions and more regarding your 2005 bankruptcy, and will advise you precisely.
    0 Votes

  • 35x35
    Sep, 2010
    Bill
    Regarding what will happen if you do not resolve your debt, see the Bills.com resource Collections Advice to learn your rights and the rights of creditors. Specifically, this resource will explain about liens, wage garnishment, and account levy. Under federal law, a creditor is required to file a 1099C whenever it forgives a loan balance greater than $600. This may create a tax liability for the former property owner because it is considered "income." However, The Mortgage Forgiveness Debt Relief Act and Debt Cancellation provides tax relief for some loans forgiven in 2007 through 2012. See the IRS document "The Mortgage Forgiveness Debt Relief Act and Debt Cancellation" and the Bills.com document Mortgage Forgiveness Debt Relief Act to learn more.
    0 Votes

  • 35x35
    Aug, 2010
    stan
    my wife and i had financed a mobil home here in las vegas in 1998 come 2009 we decided to sell it and buy a real house. we put it up for sale and had a few buyers during that time we also decided to buy a house ..we were offered a deal on some homes and picked one. we qualified with no problem. we contacted the mobil home finance company and told them we could no longer keep the home and that we had buyers. well here it is 11 months later and we get a bill from them wanting $18k thats the difference when they sold and what we owed. we paid over $49k during the 11yrs now they want the difference..WHAT IS MY OPTION because there is no way we can pay that 18k..please let me know..
    0 Votes

  • 35x35
    Jul, 2010
    Bill
    If both mortgages were included in the bankruptcy, and you never reaffirmed the mortgages then you do not have personal liability for the debts. You are free to walk away at any time. I hasten to add that I am basing my observation only on what you wrote above. Consult with your bankruptcy attorney to make sure that your understanding of what was discharged in your bankruptcy is accurate, and that you did not reaffirm the mortgages.
    0 Votes

  • 35x35
    Jul, 2010
    deejee
    My husband and I filed chap. 7 in 2008, it was discharged at the end of 2008. We have not been able to pay our 80/20 mortgages since April of this year, and have just gotten our first notice from our 1st lender regarding them pursuing a forclosure. Would we be better off going into forclosure or voluntarily surrendering our property? Our house is worth significantly less than we paid for it because of market values as well as many projects in the house that were started, but not finished due to lack of funds, so selling it is not an option. We never re-affirmed our mortgages (our lawyer didn't even discuss that option with us). We live in Colorado. I appreciate any input.
    0 Votes

  • 35x35
    Jul, 2010
    Bill
    Is the bank participating in HAFA? If so, the deficiency will be waived. Regardless, consult with your bankruptcy attorney, who will present the proposal to your bankruptcy trustee. Whether he or she will approve this idea will depend on your specific circumstances.
    0 Votes

  • 35x35
    Jul, 2010
    Joe
    We have been in a chapter 13 for 33 months. At that time we reaffirmed our house with M&I bank. We have been making all agreed upon trustee payments on time every month (payroll deducted). Now we need to buy a house because the one we have is to small. My current house value is upside down so we decided to do a short sale. The bank has an offer for the house but will leave me with a $24k deficiency. We make enough to cover the mortgage on the new house but not sure what will happen with the deficiency. The bank advised that they will make it unsecured credit and put in into my bankruptcy. Will the court allow this and is there? Should I just surrender the house and wait another 2 years which we cannot really do because of the family size! Is it possible to get permission from court to purchase the new home?
    0 Votes

  • 35x35
    Jun, 2010
    Bill
    I cannot offer an observation on a contract I have not seen. Also, you explained the circumstances surrounding the price increase in vague terms, which may be significant in an analysis of your situation. Consult with an attorney in your state who will be able to review your contract in person.
    0 Votes

  • 35x35
    Jun, 2010
    Robin
    I have been buying a home for a little over 2 years now, in New Mexico, I have been having a great deal of problems in regards tot he owner, the taxes, or the lack thereof. I have heard of the Voluntary Give Back, however I am concerned regarding this issue. 1) Can the owner, once I return the home, pursue me for the cost of the unpaid balance? 2) This is all done on a Real Estate Contract, between Owner and myself, is there different rules regarding this type of purchase and give back? The home buying price was $20,000.00, and our monthly payments were $250.00, now with certain issues, our monthly payments have jumped to $320.00, this is primarily why I want to give it back and begin again.
    0 Votes

  • 35x35
    Jun, 2010
    Bill
    There is not enough information in your question for me to make an observation. What is the source of the lien you mentioned? Or are you referring to the stay that was placed on your accounts when you filed for bankruptcy? Regardless, consult with an attorney in your state who can review your situation in detail, ask probing questions, and give you an answer that is consistent with your state's laws.
    0 Votes

  • 35x35
    Jun, 2010
    Fred
    I'm in Chapter 13 bankruptcy protection and my company has relocated me to another city and has offered to purchase our home for what I owe and then sell it to an outside buyer. Before the company will proceed, the company requires the Judge to issue a Court Order to lift the lien on the home. The company will then assume the mortgage payments and market the home to an outside buyer. Has anyone ever been through a similar situation? Do you have any advice? Will the Court do this? Any help is greatly appreciated.
    0 Votes

  • 35x35
    May, 2010
    Bill
    Look into HARP, the Home Affordable Refinance Program, which allows homeowners to refinance their existing mortgages to current low interest rates. It is designed for homeowners who are current on their mortgage payments but are unable to refinance to a lower interest rate because their home values have decreased. Homeowners may be eligible if their first mortgage does not exceed 125% of the current market value of the home. See the HARP Web site for a brief questionnaire to determine if you qualify.
    0 Votes

  • 35x35
    May, 2010
    MarkO
    I am divorced 2yrs after 30+ yrs in the house we bought together at the beginning of our marriage. Court order states I am to refinance. I can afford the house note. The note is 2x's what it is worth. I have 815 credit score. If the market didn't crash I would have been able to break even. Under the guidelines I am reading, shouldn't I be able to ask for "fair market" refi? Example: House worth $50,000.00 and I owe $87,000.00. Could they discriminate BECAUSE I can afford my house note? I have a conventional loan. Current interest rate 5.5
    0 Votes

  • 35x35
    May, 2010
    Bill
    Have you explored short sale or deed in lieu of foreclosure? If not, do so. If you have, why are you not pursuing these options?
    0 Votes

  • 35x35
    May, 2010
    Tami
    Washington State, home we don't live in(noone does), had to move accross the state for a job for my husband,we have an 80/20 loan and a LOC attached to the home, we have tried to sell twice in the past year and a half listing it for only what we owe plus closing costs, no offers, nothing, we have tapped all our savings to pay the mortgage on the empty house and our living expenses here, we're considering surrendering it even after knowinbg all the consequences of that BUT what we don't know is in Washington State does the 80/20 and LOC get taken care of w/whatever the bank can sell the house for? Any help woulds be greatly appreciated. Thank you.
    0 Votes

  • 35x35
    May, 2010
    Bill
    No one can speak for the creditor here but the creditor, and predicting the behavior of an unknown creditor is especially difficult. Consult with your real estate attorney regarding your state's statute of limitations regarding the lien in your state. Consumer-friendly states have brief SOLs. Bank-friendly states have long SOLs. One last thought. The mortgage melt-down has caused mortgage servicers act in ways I have not seen before. Your mortgage attorney's statement may have been ridiculous five or ten years ago, but not today.
    0 Votes

  • 35x35
    May, 2010
    William
    My wife and I got married after my ex-girlfriend left me with all the bills in late 2006. I filed Chapter 13 bankruptcy(5 yr plan) in 2007. My ex-girlfriend & I purchased a cabin in 2005 and re-fi'd it using a home equity loan on my home mortgage. (My ex-girlfriend was not on the mortgage of either cabin or the home). I surrendered the cabin with the bankruptcy filing, however, forgot about the lien on my home mortgage. When my wife and I applied for a home equity loan to put in a new septic system, the lien popped up that I had forgotten with the bankruptcy filing. (Note: My bankruptcy lawyer did not do a title search or credit check on me before filing the chapter 13 plan!?). He said, "if you didn't know about it, then I didn't know". Anyway, my wife and I hired a real estate attorney to see if the lien could be release from the home mortgage. No luck, so we are volutarily foreclosing on the home and have rented another residence. The mortgage lender will be satisfied after the subsequent sale of the home, however, I understand that the 2nd lienholder can "come after us" from 6mos. to 6 years AFTER the bankruptcy plan is done. The 2nd lien was $83K in 2007 when I filed chapter 13, so with interest, our real estate attorney thinks it's about $100K now...and will continue to grow!! We're "rolling the dice" on the chance that the 2nd lienholder will "forget about us"(our real estate attorney told us "the company is HUGE".)!!??
    0 Votes

  • 35x35
    Apr, 2010
    Bill
    My short answer to your question is, "I do not know." Read a longer version of my answer to a fellow reader with a similar question here: Homeowners Insurance, Bankruptcy & Quitting a Property.
    0 Votes

  • 35x35
    Apr, 2010
    Betty
    My husband and I filed Chapter 13 in Arizona. 341 Meeting was on Nov. 18, 2009 and we made our first payment to Trustee before that date. Our house was surrendered in the bankruptcy. Since we moved out neighbors have told us there has been vandalism. We have not turned over keys or signed papers with lender to turn over the house. They haven't contacted us, either. Are we responsible for the vandalism? Our insurance agent wasn't sure and said they'd have to write a policy for a vacant building since it's been vacant for more than 30 days. We left in August 2009. Lender was very non-committal and told me to call the attorney. Never spoke to attorney but an assistant told me we're not responsible. Another assistant told me we cannot uninsure the house -- we're obligated to carry insurance. If we could afford to fix the house, we wouldn't be in bankruptcy. Any ideas? Are we going to be held liable for repairs? Insurance agent doesn't think they're liable. And I can't get a straight answer from anyone. Surely we're not the only ones who have surrendered their home and then had it vandalized. Agent was going to go out and assess the damage today.
    0 Votes

  • 35x35
    Mar, 2010
    Bill
    I cannot answer your question because 1) I have not seen what was included in your bankruptcy discharge, and 2) it would be folly for me to predict the behavior of your mortgage company. Consult with your attorney. You paid him or her a large sum to gather your financial information, format it properly for the bankruptcy petition, argue with the trustee, and answer your questions. He or she has all of your financial information and will be able to review your discharge accordingly. That said, my sense is you fear receiving a foreclosure notice. That may not be such a bad thing, and may be a formality necessary for the bank to take possession and auction the property in your state. Again, this is a question for your bankruptcy attorney.
    0 Votes

  • 35x35
    Mar, 2010
    DAC
    Here's a question I can't find an answer to, especially not from the lender, and not even from my own attorney. My husband and I filed Chapter 7 in Illinois last year. Our trustee meeting was in August, and our discharge date was Oct. 5. We made it clear from the very beginning of our filing, and at the trustee meeting, that we were surrendering everything voluntarily. Is it possible (or legal) for a lender to come back on us 6+ months later and serve us foreclosure papers on a house that we surrendered in October?
    0 Votes

  • 35x35
    Feb, 2010
    Bill
    As a lease tenant, you have rights to prevent your eviction from the property without proper notice. See the Bills.com resource Foreclosure Tenant to learn more about the "Protecting Tenants at Foreclosure Act of 2009," a federal law.
    0 Votes

  • 35x35
    Feb, 2010
    Paula
    My husband and I are/were renting my sisters house. We have been paying her for over a year up till this month. The bank started to leave business cards on the front door over a month ago, so I assumed the money I was giving her, was not paying for the mortgage of the house I am living in. She told me she is filing for Chapter 13 and she is going to hand the keys over/surrender to the bank on April 1st. I am very upset about this, I have been paying her and she tells me I have about 5 weeks to find somewhere else to live. Once she surrenders the keys to the house, how long do I have before I have to get out? I wont have enough money to move in weeks.
    0 Votes

  • 35x35
    Feb, 2010
    Bill
    It would be folly for me to offer an observation without knowing more facts about the circumstances here. Consult with a New York attorney who has experience in probate, bankruptcy, or real estate law to learn what your rights and options are in this situation.
    0 Votes

  • 35x35
    Feb, 2010
    Lisa
    My mother passed away in December and I inherited the house. Along with the house I inherited the leins (about $12,000) and back taxes ($22,000). There is no mortgage on the house but the town served me foreclsure papers. To avoid foreclosure I want to file Chapter 7 bankruptcy and surrender the house. I am in New York STate and my understanding is that the trustee with pay me $50,000 if I surrender the house because that is the homestead exemption. So, my question is how long after I would file the bankruptcy would I have until I had to leave the house? And when do you get paid that money? After the hosue sells? Or at the time of the bankruptcy?
    0 Votes

  • 35x35
    Jan, 2010
    Bill
    I recommend you consult with a bankruptcy attorney in California regarding your very specific questions. Such an attorney will be able to review your situation in detail, which will result in a more accurate answer.
    0 Votes

  • 35x35
    Jan, 2010
    Jim
    We are filing a joint Chapter 7 in California. For purposes of the federal domicile restrictions I must use Illinois exemptions and my wife must use California's. Does this mean we use the federal exemptions as the two states conflict? Also, we own a house in Illinois with a second mortgage which we wish to surrender. Must I file a Consent to Foreclosure with both lenders? Is the Statement of Intent enough to avoid a deficiency judgment on the junior note? Thank you in advance.
    0 Votes

  • 35x35
    Jan, 2010
    Bill
    Your mother's actions concern me because she seems to be operating without the advice of an attorney. Your mother's situation is more complex than you described, and I urge you to recommend that your mother consult with an attorney experienced in probate law immediately. Also, I recommend you read Am I Liable for My Deceased Spouse's Debts? to educate yourself on the basic issues involved here. I realize I am not answering your questions. I do so deliberately because I believe they are premature.
    0 Votes

  • 35x35
    Jan, 2010
    trt
    My dad recently passed away and left my mom with a unpaid home and car. She is on disability and can not afford them. She returned the car to the lender, and waiting for them to sell. She wasnt on the loans, what can she do about the loans? Should she have the mortgage transferred to her and file bankruptcy? If so, to keep the house which chapter?
    0 Votes

  • 35x35
    Jan, 2010
    Bill
    I cannot speak for Chase, and therefore recommend you speak to a customer service representative there to learn if and when Chase plans to send the sheriff to evict you. Alas, being paid to stay in a property the homeowner has been foreclosed upon sounds like an urban myth. Readers, if you have first-hand evidence to the contrary please share it below.
    0 Votes

  • 35x35
    Jan, 2010
    Christopher
    I live in New Mexico. We just went through Chapter 7 on Dec, 11 and surrendered our home. About how long do we have before we need to move? Should I call are mortgage company (Chase) and Discuss it with them? Not to be greedy, but if I can stay months without paying a mortgage. I would like to. I have also herd of people being paid by the bank to stay and take care of the home. I this true?
    0 Votes

  • 35x35
    Jan, 2010
    Bill
    I recommend you speak with your bankruptcy attorney regarding this. It is highly unlikely that you can get sued as the house has been surrendered and you are no longer the owner.
    0 Votes

  • 35x35
    Jan, 2010
    JoJoGirl
    We filed for Chapter 13 and surrendered our home at the Trustee meeting. The house is not insured, due to the fact that it is empty and nobody would provide me with insurance. I don't want to get sued if the pipes burst for lack of oil and the electricity, most likely, will get shut off. We are, by law, not allowed to make any payments on the abandoned property and could get into trouble. That I did research. What can happen.
    0 Votes

  • 35x35
    Nov, 2009
    Bill
    Impossible for me to answer your question because you did not mention what state you reside in. In some states you would have two months tops. In others the process could drag on for a year. Regarding your vehicle, each state has different exemptions for vehicles. I suggest you consult with an attorney in your state who has experience in bankruptcy. He or she will know your state of residence, and have a better view into your financial picture. In the meantime, see the Bills.com bankruptcy page.
    0 Votes

  • 35x35
    Nov, 2009
    Marcy
    My husband and I are considering filing for bankrupcy after both losing our jobs in a span of one year and a half. If we decide to surrender our house, how long would we have before having to abandon the premise? If we decide to surrender our house, can we still retain our vehicle and continue making payments on it?
    0 Votes

  • 35x35
    Oct, 2009
    Bill
    Generally speaking if something such as an appliance is considered a fixture then it is considered to be a part of the property. If for example, a stove top is fixed to a counter then it would be considered a fixture. On the other hand, a free standing refrigerator would usually not be considered a fixture. Ultimately it depends on the appliances in question. Obviously things like floor tile, carpeting, molding, and light fixtures are affixed to the property and would stay.
    0 Votes

  • 35x35
    Oct, 2009
    Dawn
    I in bankruptcy and have surrendered my condo back to the bank. My question is what is surrendered back is it only the walls, floors, etc or appliances as well?
    0 Votes

  • 35x35
    Oct, 2009
    Bill
    I am not sure I understand all of the issues you mentioned. Accordingly, I suggest you consult with an attorney in your state who is experienced in bankruptcy law. To find such an attorney, call your county bar association. Ask if they have a list of attorneys in your area who practice bankruptcy law. Alternatively, go to the Web site for your state's bar association, and see if the state bar has such a list. Talk to several attorneys before you pick one. Work with an attorney who you think will have the time an patience to answer your questions.
    0 Votes

  • 35x35
    Oct, 2009
    Raebecca
    My husband and I are not sure what we should do??? We need to know if we should Voluntarily surrendered are home and keep the credit debt or file bankruptcy and add all debts. If we do a bankruptcy then what kind? I know we should get a lawer but what kind?
    0 Votes

  • 35x35
    Oct, 2009
    Bill
    Generally speaking, if you are on a month-to-month lease, you are obligated to give the landlord one month of notice you are vacating the premises. However, if you are leaving a mobile home on the land, then even though you are not in the mobile home your mobile home is occupying the space. In that situation, it would be fair for the landlord to continue to expect someone to pay for the occupation of the space, even if you are not living there. Each state has resolved this type of question differently. (California in particular has a body of law devoted to the rights and liabilities of tenants in mobile home parks.) I suggest you speak to an attorney in your state who is experienced in property law who will be able to determine your rights and liabilities under your state's statutes and court cases.
    0 Votes

  • 35x35
    Oct, 2009
    Bill
    "Voluntarily surrendered" is not much better than an involuntary repossession, in my humble opinion. Also, in my opinion, such an entry is further evidence you are dealing with a hardball creditor. There should be no entry on your credit report at all -- zip, zero, nada -- until the entire litigation is settled. Under these circumstances accept nothing less than a "paid in full" entry on your credit report. After all, you would still be a customer of theirs had they not violated the terms of the mortgage, right?
    0 Votes

  • 35x35
    Sep, 2009
    Scott
    I have house that has 2 mortgages 80/20 through the same lender, was originaly NovaStar, which sold the loan to Saxon. My 80 loan had it rate raised above the allowed terms that were in the loan. There were other issues witht he loan. I hired a lawyer, which was able to obtain a restraining order and an injunction, the mortgage company was not allowed to touch my credit or the house until after trial. This was in Feb. In June they sold the house via a foreclosure auction. They are now offering to either reverse the sale and proceed with the court case, or take back the house and report to my credit a line showing "property voluntarily surrendered", with no further reporting on my credit. As of now my credit shows 1 late from January, and otherwise current. I beleive voluntarily surrendered is a code 95. They will also release me from any deficancy, and I will drop my case. My question is will this be a major hit on my credit, and how long will it be there for? From what I read it looks like it may show up as a minor deficency because it is current. Is voluntarily surrendered by itself a "major credit hit"? My median score right now is a 700, with the exception of this 1 late payment everything else is excelent, and once this house is off of my credit, my debt to income ratio will be amazing. Thanks in advance, Scott
    0 Votes

  • 35x35
    Sep, 2009
    Darlene
    I am currently trying to sell my mobile home that is located in a mobile home park. I previously had it rented to my step-daughter but she has moved out. I am considering surrendering my mobile home that is vacant. We do not have a lease but pay the lot rent from month to month. Will I be responsible for the lot rent if I surrender the trailer back to the lein holder? The lein holder is not the person that owns the mobile home park.
    0 Votes

  • 35x35
    Sep, 2009
    Sam
    The best piece of advice that I can provide is to speak with your attorney and ask him the questions posed in your comment, as he or she should have experience working in your the bankruptcy courts in your federal district, and has probably worked with the judge handling your case in the past. This experience will give your attorney a much better feel for what the judge will expect of you and how much time the process of lifting the stay and foreclosing on the property will take. The amount of time largely depends on how busy your local bankruptcy court is, as that will determine when the judge can schedule a hearing on the lender's motion to grant relief from the automatic stay. As for staying in the home until the stay is lifted and the lender foreclosures, I know of no requirement to leave the home early becuase you are surrendering the property in bankruptcy. You are also under no obligation, to my knowledge, to notify the lender if you do choose to leave sooner, though I think that you probably should; there is no reason to create unnecessary enmity between you and the lender, and there is no good reason I can think of to not give the lender notice. Again, I am not a lawyer and I don't know enough about your situation to provide you with any concrete advice, so it is imperative that you discuss these questions with your attorney before making any decisions on how to proceed. I wish you the best of luck!
    0 Votes

  • 35x35
    Aug, 2009
    Matt
    We recently filed ch. 7 bankruptcy. We are surrendering our properties (one residence. one rental). I understand about the stay of action and that the lenders have to petition the court to lift the stay so they can foreclose. My question is: 1. Can we stay here until they do? How long until a foreclosure will occur after filing for ch 7? If we were to abandon the properties are we under any obligation to inform the lenders or "turn in the keys"? Thanks for your help.
    0 Votes

  • 35x35
    Jul, 2009
    Mark
    Is you question pertaining to the disposition of the property as a result of the divorce settlement agreement, a possible default on the second mortgage, the renters not paying the monthly rent, or something else? There is no law requiring a divorced couple to dispose of property they own. To the contrary, they may agree to hold the property jointly until a date in the distant future, and then decide how to dispose of the property. If a rental property is cash-flow positive, then a second mortgage is not necessarily an issue.
    0 Votes

  • 35x35
    Jul, 2009
    Randy
    What happens when the current property is owned by a divorced couple and is currently being rented and there is a second mortgage? Any clues on how this may play out?
    0 Votes

  • 35x35
    May, 2009
    Emily
    You state that you included your home in your bankruptcy case, so I assume this means that you surrendered the home during the proceedings. Once you surrendered the property, any balance on the mortgage should have been treated like an unsecured debt and discharged along with your other debts. In my experience, it is definitely not normal for a creditor to sue a debtor for a debt that has been discharged, though it occasionally happens due to record-keeping errors by the creditor. To resolve a lawsuit filed for a discharged obligation, the debtor is usually only required to file a response showing that the debt was discharged and the judge will dismiss the lawsuit. The fact that your attorney told you not to appear seems strange to me, as failing to appear usually will result in a default judgment, which could lead to wage garnishment, property liens, etc. Iencourage you to contact a different attorney for a second opinion to make sure that you are appropriately responding to this lawsuit. I wish you the best of luck!
    0 Votes

  • 35x35
    May, 2009
    Trish
    We filed Chap 7 and was discharged in Dec 2008 we included the house in the bankruptcy, now in May we got papers in the mail from the oringinal lender( they were put in the bankruptcy) that they are suing us for the amount owed $170,000.00 and there attorney fees. I called our lawyer and she said that this is normal, and if we get a summons to appear in court don't go. To me this doesn't sound kosher, can they sue us, garnish my husbands wages? This is what they are threatening to do.I am scared, we even gave up our car.Please give me some advice, thank you.
    0 Votes

  • 35x35
    Apr, 2009
    Bill
    Katie, thanks for visiting Bills.com. As much as I can understand the hardship that you are going through, I am not a bankruptcy attorney and I do not know much about the means test. The best thing to do is to consult with an attorney who is licensed to practice in your state. I do know that if after the means test, if you qualify for a Chapter 7 type of a bankruptcy, it is basically a fresh start. You can read more about bankruptcy at http://www.bills.com/bankruptcy/
    0 Votes

  • 35x35
    Mar, 2009
    katie
    I lost my job sep 08, my husband lost his dec 08, i am currently working out of our rental home and will be receiving a 1099 this year. we are a family of 5, that used to be fairly comfortable. we made several bad choices with homes and vehicles. currently we have mortgages on 2 properties - 1 which we have at least got rented. but can not afford to live in our other home. it has been on the market since i lost my job in sep. our family has gone from having extra money, good credit, and doing as we please to barely surving. we should be paying in quarterly taxes but havent been able to, were in the early stages of forclosure, have no health insurance and have called one lender asking if we can voluntarily give back 1 vehicle. Bankruptcy scares me but i dont see much daylight at the end. all this being said, if we file bankruptcy it would be on 2 vehicles (1 @ 15k and 1@ 17k, 2 houses (1 @ 67k and 1 @ 280K ) we have tried to short sale the 280K house but country wide is not working with us, 1500.00 medical and 2500.00 credit card debt. we were crazy enough to get 2 sub prime mortgages at once and now were stuck. when figuring the means test do they figure bills we should pay but cant like health insurance? and is there a bankruptcy that allows you to give back everything- but not have a trustee and a repayment plan. something that is really a fresh start?
    0 Votes

  • 35x35
    Mar, 2009
    Bill
    If you cannot continue to make the payments, you should talk to your attorney and the trustee. If they agree, you could be free and clear. If you also have other debts (credit cards, etc) you may want to also inquire about converting to a chapter 7 and just get a clean slate and a fresh start. Good luck Anna.
    0 Votes

  • 35x35
    Mar, 2009
    anna
    i live in ohio cleveland area.we filed chapter 13 but no longer can make house payments can we just surrender the house to bank without legal reprucusion from bank.
    0 Votes

  • 35x35
    Mar, 2009
    robin
    need information on surrendering my home, and will i get to keep my other assets?
    0 Votes

  • 35x35
    Mar, 2009
    Bill
    You will need to speak with your lender about it. It is not as simple as handing over your keys and walking off as you will have to deal with all the paperwork. If in case your home is not worth enough to pay the loan back in full, you might still owe a deficiency balance on it. The creditors can pursue collections on this balance just like another unsecured debt. You can read about the collection laws for various states here: http://www.bills.com/collection-laws/.
    1 Votes

  • 35x35
    Jan, 2009
    Bill
    You cannot file for chapter 7 at will, you need to qualify for it through the means test that they administer. If you surrender your home, and include any deficiency balance that remains, in your bankruptcy filing, then your lender cannot come after you to collect on it again.
    0 Votes

  • 35x35
    Jan, 2009
    Ann
    We are currently in chapter 13 and have not been able to keep current with payments. We have decided to go ahead and surrender our home--and in the meantime there has been a move from the trustee to dismiss our 13 --if we convert the 13 to a 7 --would that be our only option at this point? The home is in my name only --not my husbands. Could we surrender the home that is now worth 40,000 less than what we owe? Will Wells Fargo try to collect?
    0 Votes

  • 35x35
    Jan, 2009
    mark
    I live in Oregon, I bought a house in April of last year and carry a mortgage of 131,000, I live alone. I thought I was getting a great deal because the same units sold for as much as 210,000 at the end of 2005 when they were built, mine was a foreclosure that had never been lived in. Heck, it would cost 140k just to replace it for insurance purposes. It turned out not to be such a great deal, the town is fast become a slum, crime and vandalism have become rampant. To make matters worse I have a next door neighbor that is easily one of the most objectionable people I have ever met and the straw that broke the camel's back was his standing in my driveway yelling hate speech at 9:00 last Sunday evening. Invented new terms for perceived sexual orientation. He claimed to be on the HOA board and so can make problems for me. He is full of it of course, but aside from being a white supremacist with a criminal record I just do not want to live next to this loser. Well, the house (zero lot line 3 story townhouse) that appears to be attached to mine was also a foreclosure and has never sold. The bank has dropped the price to 99,900 and still few lookers no takers. Another unit up the street sold a few weeks ago for 91k. This means I am at least 40 thousand in the red just since last April. I cannot sell, I cannot even list it, nobody will represent it. I can afford the payments, but I cannot continue to live here. The two units across from mine are identical and have been on the rental market 7 months since last mid-summer with no renters interested at 800 a month. My payments are just over 1000. I cannot file bankruptcy till at least May of next year since I filed in 05/2003 after a disastrous house fire in NY. My mortgage is backed 100% by USDA Rural Development, and they say they do not go after people after a foreclosure. I do not believe my income is attachable, my income is a VA disability and social security disability as a disabled veteran. This is driving me crazy, I worked so hard for years after the bankruptcy to restore credit score(last month it was 707) and I do not want to abandon my place, but what else can I do? If the payments could be covered by rents I might have bit the bullet and become a landlord, but I am not going through that again and lose money every month on the deal (my income is not taxable so I do not file with the IRS, I cannot get the tax advantages of mortgage deductions). I am not getting the appreciation we all expected were normal, it makes no economic sense for me to stay. Given the intolerable neighbors I really must move. I am a dual citizen of the EU (Ireland) and USA. I really do not have a question unless any of you can provide information you think will help, but I just want to say that as the credit and economic debacle has unfolded I see us reaching a point where millions will be in the same boat as me, that there will be no economic incentive to repay our loans and no way to sell, it will become a downward spiral, with millions trapped in houses they wish they could move out of.
    0 Votes

  • 35x35
    Dec, 2008
    Bill
    The lender has two incentives here: 1. they have a legal obligation to sell it at a market price (and if you think the price is eggregiously low, you could alway sue them to prove that it was a market price and that the broad marketplace had an opportunity to bid on it), and 2. they take much less risk if they can sell it for the highest amount that they can in a reasonable period of time. I hope this helps, but banks almost always try to get the highest market rate for repossessed assets.
    0 Votes

  • 35x35
    Dec, 2008
    Mike
    I am considering surrendering my home and the biggest concern and question I have is since I will be responsible for the difference between what I owe and what they sell it for, what will keep them from selling it for almost nothing?
    0 Votes

  • 35x35
    Nov, 2008
    Bill
    Short sale is definitely an option if your mortgage is upside down. You need to work with the mortgage company as you will need their approval for the sale.
    0 Votes

  • 35x35
    Nov, 2008
    Marie
    I have been in bankruptcy for the last 2 years, and every year or 6 months my bankruptcy payments have increased. I am living at a poverty level and barely able to pay the utilities/food/gas bills, I only get 210.00 out of my paycheck every two weeks. I have had to obtain a second job to just stay alive. So I want to surrender my home back to the mortgage company (seeing that I do owe more than what I originally got the loan for) but I may have a potential buy in a few months. My lawyer advised me that if I am in foreclosure and I have a option to do a short sale during the foreclosure procedures, then the mortgage company may consider it...is that true?
    0 Votes

  • 35x35
    Oct, 2008
    Sam
    Unfortunately, surrendering your home to your lender, often referred to as a "deed in lieu of foreclosure," may have much more serious affects than causing damage to your credit rating. New York law allows lenders to obtain deficiency balance judgments against borrowers whose home loan is not covered by the proceeds of the foreclosure auction. In order to obtain a deficiency balance against you, the lender would need to file a motion your county courts requesting a judgment for the difference between the amount you owed on the mortgage and the amount which the lender receives for the property at auction. The problem for many consumers is that foreclosed homes tend to significantly less than their actual value, which often leaves the former owners liable for significant deficiency balances. You can read about state foreclosure laws by visiting http://www.foreclosures.com/pages/state_laws.asp. Not all lenders pursue former homeowners for defiency balances on foreclosed homes, but this is a possibility you must consider before you decide how to proceed. Given the difficulty of your financial situation, I would strongly encourage you to consult with an attorney in your area to discuss the options available to you. For example, filing for Chapter 7 bankruptcy protection may allow you to surrender the property without the worry of incurring a deficiency balance. Your attorney should be able to analyze your overall financial situation and explain the risks involved in negotiating a deed in lieu agreement with your lender. To read more about foreclosure, you can visit http://www.bills.com/foreclosure/. Also, if you would like to learn more about bankruptcy, you should visit http://www.bills.com/bankruptcy/. I hope this information helps.
    0 Votes

  • 35x35
    Oct, 2008
    joyce
    I have tried for the past two years to sell my home with no success. Finally in August I had an offer to do a short sale. My mortgage company has declined this offer. I have been in foreclosure for approximately 4 months now. I have no recourse but to surrended my deed to the lender. How do I go about doing this and besides my credit being ruined, what other reprecussions will I face. I reside in the state of New york
    0 Votes

  • 35x35
    Oct, 2008
    Bill
    I would strongly encourage your father to speak with his bankruptcy attorney about this situation. Generally speaking, people who have filed for bankruptcy protection are protected by an automatic stay from any collection action taken by their creditors, regardless of whether or not the creditor was included in the bankruptcy filing. Any creditor who wishes to move forward with collection action is usually required to file a motion with the bankruptcy court to have the stay lifted so it can proceed with its collection activity, which could include a lawsuit. If this creditor is proceeding with collection activity while a stay is in place, the bankruptcy court may be able to intervene on your father’s behalf, though is attorney would need to notify the court of the situation so it can take appropriate action. Your father may also be able to amend his bankruptcy case to include the deficiency balance on his home (the amount left on the loan after the home is sold at auction, which is an unsecured debt) in his Chapter 13 case, though limitations do exist regarding what can or cannot be added, and when such amendments can be filed. Your father needs to discuss this option with his attorney to determine if including this debt in his bankruptcy case is a possibility. Finally, your father may be able to convert his Chapter 13 filing to a Chapter 7 filing, which may allow him to fully discharge this debt and his other unsecured debts. Most people file Chapter 13 to protect their assets, which usually means a home; since your father no longer owns a home, Chapter 7 may be a better option for him. I strongly encourage him to consult with his attorney as soon as possible to discuss the various options available to help him resolve this debt. I wish him the best of luck!
    0 Votes

  • 35x35
    Oct, 2008
    nicole
    My father filed chapter 13 bankruptcy last year. The house was initially locked into the bankruptcy, but after a great inability to pay the bills, he surrendered the house as well. Now the mortgage company is suing him for the money owed, and the house is technically pulled back out of the bankruptcy [surrender.] Is there anything that can be done to save the house? He has tried to contact the mortgage company several times, but has failed to get in touch with anybody because they keep getting bought out by other companies and do not seem to want to comply. Please help, I'm desperate.
    0 Votes

  • 35x35
    Jan, 2008
    Roy
    My wife and I have recently moved into a new home. The mortgage was secured in her name. We moved from a home in another town that I own. I am "upside down" on the mortgage. Consequently, real estate companies won't list the property for sale. I've tried 2 differnt times to sell the house on my own with no luck. I finally found someone to rent the home, for $500 less than my monthly payment. My wife has been diagnosed with a serious illness. The burden of loosing $500 a month has now become a major financial issue. I think I could convince the person renting the home into a buy situation if I could lower the price a bit (maybe $10,000). Do you think I would be a candidate for a "short sale"?
    0 Votes

  • 35x35
    Jan, 2008
    Nathan
    You will need to speak with your lender on this. Discuss your situation with them and provide detailed documentation about your current financial hardship to see what you are able to work out, but keep in mind that there is still a chance they might not agree. All the best.
    0 Votes