Can I walk away from my home if it was included in the bankruptcy and never refinanced? 20 Answers as of September 21, 2011
I had a bankruptcy 6 years ago. My home was included in the bankruptcy. Since then I have continued to pay the mortgage. Can I walk away from the home since it was included in the bankruptcy and it was never refinanced?Free Case Evaluation by a Local Lawyer!
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Mercado & Hartung, PLLC | Christopher J. Mercado
Your personal liability might have been discharged but the property is still on the hook for the security interest.
Answer Applies to: Washington
Replied: 9/21/2011
Bird & VanDyke, Inc. | David VanDyke
If you filed bankruptcy, properly listed the debts on the home in your schedules and did not reaffirm the debt then you can walk away with no liability.
Answer Applies to: California
Replied: 9/20/2011
Indianapolis Bankruptcy Law Office of Eric C. Lewis | Eric Lewis
If you did not sign and file a reaffirmation agreement, then you can walk away from the mortgage and not be responsible for the foreclosure deficiency. You must, however, keep the house insured and in compliance with zoning and other applicable laws to avoid any future personal liability before the deed transfers out of your name to the bank or a subsequent buyer.
Answer Applies to: Indiana
Replied: 9/19/2011
Heupel Law | Kevin Heupel
Yes, provided that you never refinance the home after filing bankruptcy, then you can walk away even though it has been six years.
Answer Applies to: Colorado
Replied: 9/19/2011
Bankruptcy Law office of Bill Rubendall | William M. Rubendall
When you file bankruptcy your home loans are included. The lender retains a security interest. You no longer have personal liability for the loans. You can give up the home without owing anything because of the bankruptcy discharge.
Answer Applies to: California
Replied: 9/16/2011
G. Anthony Yuthas & Assoc. | Tony Yuthas
There is a theory here that you may have to deal with concerning a de facto reaffirmation. You need an attorney to help you deal with this before it becomes a problem.
Answer Applies to: Colorado
Replied: 9/16/2011
Dan Wilson Bankruptcy | Dan Wilson
Yes. Your bankruptcy discharged the underlying debt that is secured by your mortgage.
Answer Applies to: Colorado
Replied: 9/16/2011
Grace Law Offices of John F Geraghty Jr. | John F. Geraghty, Jr.
It sounds like the debt was not discharged and was redeemed so you are still liable if you walk away.
Answer Applies to: Georgia
Replied: 9/16/2011
Law Office of Harry L Styron | Harry L Styron
A bankruptcy does not alter a secured obligation. If you walk away the house will be foreclosed, the foreclosure will show on your credit report for at least 8 years. If the home was not refinanced at any time after purchase then you cannot be held liable for any deficiency when the creditor resells it, but if it has been refinanced at any time then you may. Also, since you are not filing bankruptcy along with the foreclosure, the creditor may file a 1099 with the IRS for the amount of deficiency, and the IRS may treat that amount as "forgiveness of debt income" and send you a bill for the unpaid income tax unless you can show that you wer otherwise insolvent at the time of the foreclosure.
Answer Applies to: California
Replied: 9/16/2011
Law Office of Asaph Abrams | Asaph Abrams
Absent reaffirmation (signing of an agreement during the pendency of the bankruptcy case to repay an otherwise dischargeable debt), one may walk away from secured collateral and not owe a deficiency balance/incur liabilities. No legal obligation is effected by virtue of having made voluntary payments. This answer (as well as our Web site) doesn't address all facts & implications of the question; it's general info, not legal advice to be relied upon; it creates no attorney-client relationship; it may be pertinent to CA only; it's independent of other answers. Hire legal counsel before acting or refraining from bankruptcy/legal action.
Answer Applies to: California
Replied: 9/16/2011
The Schreiber Law Firm | Jeffrey D. Schreiber
If the loan existed prior to filing, was listed in the bankruptcy and was not reaffirmed in the bankruptcy, then it is was discharged, you have no legal liability and the lender's sole recourse to get any money back is what they get out of the house in a foreclosure sale.
Answer Applies to: California
Replied: 9/16/2011
Rosenberg & Press | Max L. Rosenberg
As long as you did not reaffirm the debt, you can walk away without a deficiency.
Answer Applies to: Connecticut
Replied: 9/16/2011
Tucker Legal Clinic | Samuel Tucker
The reality is that by the time the mortagee gets around to seeking a judgment on the deficiency, if any, you will qualify to file another bankruptcy by passage of time.
Answer Applies to: Mississippi
Replied: 9/16/2011
Guardian Law Group PLLC | C. David Hester
Check with your attorney. If you chose to retain and pay as agreed rather than reaffirm then you could.
Answer Applies to: Utah
Replied: 9/16/2011
Cohen & Kendziorra, P.A. | Robert S. Cohen
The question rather is can you walk away with any legal consequences?. The answer is yes. You included the note in your bankruptcy and since it wasn't refinanced, then you can walk without any legal liability attaching to you.
Answer Applies to: Florida
Replied: 9/16/2011
Harkess and Salter, LLC | Stephen Harkess
If you did not reaffirm or refinance your mortgage then the mortgage note has been discharged. You can walk away without owing any deficiency judgment to the mortgage company.
Answer Applies to: Colorado
Replied: 9/16/2011
Dan Shay Law | Daniel Shay
Yes, the debt was incurred prior to filing and is dischargeable. However, you will have a foreclosure on your credit report. A short sale would prevent that.
Answer Applies to: California
Replied: 9/16/2011
Ashman Law Office | Glen Edward Ashman
That depends on things that you did not tell us. If you did not sign a reaffirmation agreement AND the case is a discharged chapter 7, yes.
Answer Applies to: Georgia
Replied: 9/16/2011
AyerHoffman, LLP | Melissa Hoffman
If you did not sign a reaffirmation agreement during the bankruptcy proceeding then you have been discharged of personal liability on the mortgage. You have no legal duty to continue to make the payments. However, if you did sign a reaffirmation agreement, you have created a new contractual relationship with your lender. If you fail to make payments you could be liable for any deficiency that results from a foreclosure or short sale. If this is the case, you may be able to file bankruptcy again since it's been six years since you last filed.
Answer Applies to: Massachusetts
Replied: 9/16/2011
Law Offices of James Wingfield | James Wingfield
Assuming your home loan was discharged in a bankruptcy and you received your discharge, then you can walk away from your *mortgage*, without fear of recourse from the bank for a deficiency judgment. But beware, if you just leave your house, there are likely to be post-bankruptcy petition charges for which you may still be responsible, such as insurance, taxes and utilities. The biggest issue could simply be liabilities. Vacant houses can attract the trouble, and could cause you far more than simply monthly expenses. Your best bed is to negotiate a deed in lieu of foreclosure with your lender (where you hand over the a deed to the house) before you leave or staying in the house until it is foreclosed upon (and paying the normal expenses, including taxes and insurance, but not the mortgage itself).
Answer Applies to: Massachusetts
Replied: 9/16/2011
