What is in our best interest after the bankruptcy and selling house? 5 Answers as of March 22, 2017

After the bankruptcy, we were trying to sell our house to pay off the VA loan because we cannot afford to keep it. We are behind in payments and our mortgage company is in the process of doing paperwork which took 30 days to list as a short sale. We have had a real estate agent and her contract expired with us 23 days ago. We just found out. Anyway she called about 2 weeks ago and said she has an offer for our house which was $60,000 less than we owe on our VA loan. She wanted us to sign paper to get this done before it went to a short sale. We found the offer unacceptable since our home is worth $100,000 more than her offer. If she did this, would we be responsible for the difference and the taxes? She wants to talk to our mortgage company directly. My husband said he would talk to our mortgage company to see what to do. My husband is 70 and our only income is social security. He lost work over 2 years ago.

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Eranthe Law Firm
Eranthe Law Firm | Cate Eranthe
If you are responsible for the difference in the sale price and what you owe on the loan will depend on whether or not you reaffirmed (a special agreement approved by the court that allows a loan to be treated as if there was no bankruptcy filed) the mortgage loan in your bankruptcy. Most of the time there is no reaffirmation and you would have no liability for the amount owed to the lender over and above what they are paid from the sale. Mortgage lenders like to have loans reaffirmed. I discourage it because of situations like you are in. Talk to your bankruptcy attorney if you aren't' certain what happened. Property taxes should be paid before the lender in which case you can't be liable. If you are referring to capital gains tax, if any, you would have to pay that.
Answer Applies to: California
Replied: 3/22/2017
Mark S Cherry, Attorney at Law, PC
Mark S Cherry, Attorney at Law, PC | Mark Cherry
Please see an attorney asap. First go to your bankruptcy attorney. Ask if the Note (your personal promise to pay) was discharged. The mortgage, (Pledge of collateral) is still valid against the real estate but not individually against the signers. You were probably discharged of your obligations under the Note, which means that the lender cannot legally come after you for any deficiency at all. Even if the Note was not discharged, you need to make sure that you negotiate that provision in the documents. It sounds to me that you have positive equity anyway, so if you receive market price you may actually walk away with money from a closing. Realtors are not your attorney, and are commission driven which may be contrary to your best interests. Get legal help to understand your options and exposure, if any.
Answer Applies to: New Jersey
Replied: 3/21/2017
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
The only one who benefits from a short sale is the realtor. The bankruptcy absolved you of the balance of the note to the VA. Furthermore in California there is no such thing as a deficiency on a "purchase money loan." You would however be responsible for the post petition taxes. If you are living there maintain the property so it looks nice and the bank may let you live there for awhile (hoping it goes up in value).
Answer Applies to: California
Replied: 3/21/2017
A Fresh Start
A Fresh Start | Dorothy G Bunce
Whether you are responsible for paying a mortgage deficiency depends on several factors, including 1. What does the short sale agreement provide? 2. Where do you live? In every state, the law on mortgage deficiencies is different. In Nevada, the lender must sue you within 6 months or it loses its rights to collect on this debt. Seldom does that occur. As to the issue of the taxes, you will be responsible for paying property taxes up until the moment any sale is completed.
Answer Applies to: Nevada
Replied: 3/21/2017
GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Do not sign anything without speaking to a lawyer face to face. The lawyer will review everything and advise you accordingly.
Answer Applies to: Colorado
Replied: 3/21/2017
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