Bankruptcy & Short Sale

Our Chapter 7 bankruptcy was discharged in Nov. 07.  We have since then continued to pay our 1st mortgage but stopped paying our second. My husband has now lost his income and we are considering letting the house go. (we could never sell it for what we owe in this market) Will the forclosure process be the same as anyone or will it be quicker, and will we be responsible for the balance?  Thanks!

Heather

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Hi Heather,

If the mortgage debt was discharged and you didn’t enter into a reaffirmation agreement then you shouldn’t be liable.  Ask your bankruptcy attorney to be sure.

The above takes care of the tradeline, as it should be ‘included in bankruptcy’, and the legal liability for the debt, but there still remains the public records entry of foreclosure.  You may consider the successful completion of a short sale to avoid the summary judgment of foreclosure in a judicial foreclosure state, such as Florida.

Thanks for the questions and I sent you an email.

Paul

This author is not an attorney and this information should not be considered legal advice.  Please consult an attorney for legal advice.