After a chapter 7 bankruptcy, am I legally responsible for the property taxes / house insurance? 12 Answers as of September 11, 2013

Our house was discharged in December 2012 but we had the intention of keeping it. We did sign an assumption of debt but we have kept making the payments on time for the house. We can't pay anymore and we have to let the house go. Will we be responsible for the property taxes we have not paid and also the house insurance that is due?

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Law Office of Thomas C. Phipps | Thomas C Phipps
You will be responsible for the property taxes, but not for the insurance if you listed it as a debt.
Answer Applies to: Missouri
Replied: 9/11/2013
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
You signed a reaffirmation agreement? I'd have a lawyer look at that. In California there is no liability on a foreclosed purchase money loan. The taxes would go with the property. The post petition insurance might be a problem. You need to let a lawyer see what you signed.
Answer Applies to: California
Replied: 8/27/2013
Hayward, Parker, O'Leary & Pinsky, Esqs.
Hayward, Parker, O'Leary & Pinsky, Esqs. | Michael O'Leary
You indicated that you signed an "assumption of debt" concerning your mortgage payments. I have no idea what an "assumption of debt" document is, but it sounds suspiciously like a Reaffirmation Agreement. If you signed a Reaffirmation Agreement (1) your obligation to make the mortgage payments was not discharged in bankruptcy, and (2) you will remain liable for any deficiency after the foreclosure auction sale if the lender makes a timely application to the Court for such relief. If you are going to "let the house go" I would not pay any more property taxes. If the tax bills are sent to you, you should forward them to the lender so it can pay them. I would keep the house insured, not because of any legal obligation to do so, but because you will remain the owner of the property until such time as the house gets sold at foreclosure. As the property owner you will be liable if a neighborhood kid falls on your property and breaks his neck or some other, less life threatening appendage. As the property owner you also must comply with municipal ordinances, so if the premises become an eyesore it will be you (the owner) who receives the municipal summonses. If you intend to live rent-free on the property until such time as you are thrown out after the auction sale, these types of exposures are certainly manageable. However, if you want to vacate the premises and move on with your life, you might consider approaching the lender (1) about accepting a deed in lieu of foreclosure, or (2) entertaining a short sale, both of which will terminate your ownership interest, and all of the baggage that goes with it, much quicker than a completed foreclosure would.
Answer Applies to: New York
Replied: 8/27/2013
Goldsmith & Guymon
Goldsmith & Guymon | Marjorie Guymon
If your names are still on title, you are liable for real property taxes. However, if you don't pay, the tax follows the property and it will be paid upon sale. You are not liable for property insurance.
Answer Applies to: Nevada
Replied: 8/27/2013
A Fresh Start
A Fresh Start | Dorothy G Bunce
You are responsible for any debts made after you filed your bankruptcy. As long as the title to the house remains in your name, you are legally responsible for paying your property taxes. Whether you are also responsible for paying property insurance is a matter up for debate. If you don't carry insurance, your mortgage company will buy insurance for you, but whether or not they will pursue you to collect is a business decision for the mortgage company to make. If the assumption of debt you signed was a reaffirmation agreement ordered by the court, you may have gotten yourself into some real hot water! Better see an attorney about this issue immediately.
Answer Applies to: Nevada
Replied: 8/27/2013
    Fears Nachawati | Sean T. Flynn
    You will be liable for the home until it is foreclosed and therefore you will need to maintain the insurance. The property taxes are tied to the property and will not follow you. The mortgage company or the new owner will need to make sure the taxes get paid or are made current. Just as a note, if you are surrendering the house after bankruptcy, but you signed a reaffirmation agreement you can be liable for any deficiency that arises.
    Answer Applies to: Texas
    Replied: 8/26/2013
    Stuart P Gelberg
    Stuart P Gelberg | Stuart P Gelberg
    Real property taxes are not a personal liability. They flow with the property only. Insurance is a post bankruptcy liability and therefore not part of the bankruptcy. You need the ins to protect yourself anyway until the house is no longer in your name
    Answer Applies to: New York
    Replied: 8/26/2013
    Rosenberg & Press
    Rosenberg & Press | Max L. Rosenberg
    Absolutely if you filed a reaffirmation agreement on the debt. That was a horribly ill advised decision. There is hardly ever a good reason to reaffirm a mortgage debt. I always use your exact situation as a reason why you should never sign such an assumption of debt.
    Answer Applies to: Connecticut
    Replied: 8/26/2013
    Steele, George, Schofield & Ramos, LLP
    Steele, George, Schofield & Ramos, LLP | Alan E. Ramos
    In California, you are not personally liable for property taxes (with or without bankruptcy). However, the property taxes remain a lien on the property and need to be paid. If you do not pay your insurance premiums on your home, you will be personally liable for any injury that occurs. Additionally, the lender will most likely purchase forced-placed insurance, the premium for which will be added to your mortgage. Unfortunately, forced-placed insurance only covers the lender and not you, so you will still be personally liable for any injuries that occur on your property.
    Answer Applies to: California
    Replied: 8/26/2013
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    Yes, you are but usually those costs are absorbed in the foreclosure sale
    Answer Applies to: New York
    Replied: 8/26/2013
    William Bidwell, Attorney at Law | Bill Bidwell
    The court does not discharge a house. It appears that you reaffirmed the mortgage on your house but have to let it go into foreclosure now. You are liable for taxes and insurance. However, the bank has the right to pay insurance on the home and backcharge you. Your bank may or may not request the balance. You may call the bank and inquire about a loan modification (if you want to keep the house), or ask if the government bailout program (TARP) is still effective.
    Answer Applies to: Michigan
    Replied: 8/26/2013
    Law Office of Lynnmarie A. Johnson
    Law Office of Lynnmarie A. Johnson | Lynnmarie Johnson
    If you signed an assumption/reaffirmation on the house, you did not discharge it and you are responsible for the payment, the deficiency if it goes to foreclosure, taxes, insurance. If you had an attorney I would get with them, but it is probably too late.
    Answer Applies to: Michigan
    Replied: 8/26/2013
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