Why is a company contacting me about a house I filed bankruptcy on in 2012? 25 Answers as of February 24, 2015

I filed bankruptcy in 2012. I went to court and to my knowledge everything was discharged but I continue to have to pay HOA dues for the house I have not lived in for 4 years and that paid to file bankruptcy on. I don't understand why the house is still in my name? I also have a company (BSI financial) who keeps calling me saying they own my loan from a bank and I need to cooperate with them to do a short sale on my house and get it out of my name. They say I will be taking no responsibility or consequences for cooperating and that it will get the house out of my name, but I don't understand why the house is even still in my name. The lawyer I used for the bankruptcy is no longer practicing. I am at a loss.

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The Law Offices of Ryan F. Beach, PLLC
The Law Offices of Ryan F. Beach, PLLC | Ryan Beach
Surrendering real property in a bankruptcy does not effectuate legal transfer of ownership. Legal ownership does not transfer until some other legal action takes place, such as a foreclosure or a sale. A bankruptcy merely resolves your liability under the note associated with the mortgage. The mortgage, or legal instrument that makes the debt secured by the property, remains intact after the bankruptcy discharge. To get the home out of your name, you may want to sell the property or work with the current lien holder to do something like short sale or deed in lieu of foreclosure. If you do a short sale, the personal liability associated with mortgage/note should have been discharged by your bankruptcy, so you should not have to worry about the lien holder pursuing you for any any deficiency. I would recommend consulting with an attorney to ensure that the debt was discharged and to assist you in any document review if you are working with the lien holder.
Answer Applies to: Michigan
Replied: 2/24/2015
Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
Most important: find a new lawyer. Since almost everything in a BR case is now available to lawyers through the federal courts database ('PACER'), he or she can get most of what s/he needs. Also it is not hard to check real estate records in most counties. Why should you think you no longer have record title to the house? If it was foreclosed, then you lost it. If you deeded it to the lender or to some other entity, you no longer own it. But otherwise.... If you listed the mortgage note in your BR, as you should have done, then the underlying debt is discharged, even if the mortgage still remains. The creditor apparently wants to sell the house on a short sale AND, HOPEFULLY, NOT TRY TO CHARGE YOU FOR ANY DEFICIENCY. If that is the case, you lose nothing by cooperating with that creditor, and you likely save yourself some bother in the future.
Answer Applies to: Wisconsin
Replied: 2/23/2015
J.M. Cook, P.A. | J.M. Cook
You may have surrendered the house during your bankruptcy, as your question suggests, but that doesn't mean that the lender foreclosed on the property. Until they do, the property shall remain in your name.
Answer Applies to: North Carolina
Replied: 2/23/2015
Tokarska Law Center
Tokarska Law Center | Kathryn U. Tokarska
A discharge in Bankruptcy has a specific meaning. Discharge of a particular debt means that the debt can no longer be collected. Some debts are dischargeable, some are not, some are dischargeable only under certain conditions and/or with extra steps in the bankruptcy process. A review of what is and isn't dischargeable is something that the attorney does BEFORE filing the case so that the client understands the risks and benefits of each type of bankruptcy and can decide which type of bankruptcy to file and when in order to get maximum benefit. Only HOA fees incurred prior to the bankruptcy are discharged in a bankruptcy case. HOA fees incurred after the bankruptcy filing up to the date of foreclosure remain the homeowner's responsibility. While the obligation to make the payments under the mortgage promissory note is discharged, the deed of trust that the lender holds on the property is not eliminated in Bankruptcy (with some exceptions that I assume did not apply to your situation and in any case because I assume a chapter 7 type of bankruptcy was filed). Whether a foreclosure happens during or after the bankruptcy filing is another matter and the bankruptcy court does not get involved in that process unless the foreclosure is done while the bankruptcy case remains open and in that situation only to the extent that the lender must first obtain court's permission to move forward. Rarely do lenders proceed with foreclosure process while the case is pending because of the added steps and expenses. Typically, the lender will wait until the bankruptcy case closes and proceed at some point in time after that. As far as I know, there is no legal mechanism by which you can force a lender to foreclose and take ownership of the property at any particular time, although some borrowers have taken steps such as letting the lender know that the property is vacant and/or delivering keys to try and convince the lender that taking over the ownership sooner rather than later is in their best interest. Some debtors chose to either continue living at the property paying HOA fees until a Deed of Trust sale date is scheduled and moving out just before that happened or right after or they moved out of the property and rented it out to cover the HOA fees. Whether you retained ownership can be verified by looking at the county recording documents.. When certain property's value was greatly below the principal balance on the note, it was not uncommon for a lender to adapt a wait and see attitude. In doing so they wished to prevent taking an immediate loss and hoping values would increase at some point to recoup more from the property or an alternative or temporary payment arrangement could be made with the debtor through a loan modification. A short sale, if approved, could potentially take care of the HOA fees. You can apply for a short sale and carefully review the terms of the agreement under which the bank is willing to proceed and discuss any tax implications of a short sale with your tax preparer.
Answer Applies to: California
Replied: 2/23/2015
Mauritz Van Niekerk, Attorneys at Law
Mauritz Van Niekerk, Attorneys at Law | Christiaan van Niekerk
Home owners are post bk debt to be paid and the bk did not release your ownership just the liability on the mortgage.
Answer Applies to: New York
Replied: 2/23/2015
    Goldsmith & Guymon
    Goldsmith & Guymon | Marjorie Guymon
    A bankruptcy does not remove an asset from your name. Only a sale will do that. You are liable for all hoa's incurring after the bankruptcy filing.
    Answer Applies to: Nevada
    Replied: 2/20/2015
    EDWARD P RUSSELL | EDWARD P RUSSELL
    I sounds like you are talking about association dues. Any such dues occurring before the date of the filing of the bankruptcy are discharged but until the title of the property is removed from your name you can be held liable for such dues post filing, so says the bankruptcy laws. I would work with that company which holds the mortgage so that the title can be removed from your name.
    Answer Applies to: Minnesota
    Replied: 2/20/2015
    Eranthe Law Firm
    Eranthe Law Firm | Cate Eranthe
    Bankruptcy doesn't transfer the title. I usually recommend staying in the house until the title transfers to avoid liability that might arise from leaving it vacant. You should also keep your homeowner's insurance in effect until title transfers. The county recorder's office is the place to see what deeds are on file and if it is still in your name. It sounds like it is still in your name. You can let the lender foreclose. I don't know why they would ask you to do a short sale. Lenders have taken years to transfer title. Since the market is improving I assume it is more interesting now than it was the past few years. Homeowners association dues incurred prior to the bankruptcy are discharged. Those that accrue after the case is filed you will owe.
    Answer Applies to: California
    Replied: 2/20/2015
    Ronald K. Nims LLC | Ronald K. Nims
    There are two parts to a mortgage, one is your personal promise to pay the debt and the other is a lien on the real estate. The bankruptcy eliminated the personal promise to pay the debt but the lien wasn't affected. You own the home because your name is on the deed, your name will remain on the deed until you transfer the property to someone else or the lender forecloses. Filing bankruptcy didn't take your name off the deed. There is some liabilities connected to being the owner of a vacant house: 1. Often, you're liable if a neighborhood kid goes in the house and gets hurt. You might even be charged with a crime for owning a dangerous nuisance in a residential area. 2. As you know, you're liable for the homeowner's association. 3. Your required to maintain the property and cut the grass. If you don't the city can take you to court and, in some states, this can also be a criminal offense. 4. If you don't keep insurance on the house, you might to liable to the lender for damage to his collateral or to the neighbors if, say, a fire spreads from the vacant house to theirs. So, doing a short sale is a very good idea. I would advise you to work with the new holder of the mortgage on this.
    Answer Applies to: Ohio
    Replied: 2/20/2015
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Since you still own this property, if you get no benefit from the ownership, you may want to take active steps to deal with this issue. Although you don?t personally owe the mortgage debt, the house does owe the mortgage debt. The lender can still foreclose on the house in order to get paid. While a foreclosure may not show up on your consumer credit report, it will be part of your credit history that every mortgage lender will be aware of and can prevent you from obtaining a new mortgage. So do you want to leave things alone or make a little effort to make a little money and sell this house?
    Answer Applies to: Nevada
    Replied: 2/20/2015
    Patrick W. Currin, Attorney at Law | Patrick Currin
    The bankruptcy did not alter the legal status of the home it merely eliminated personal responsibility for the mortgage and the HOA dues accrued prior to the filing. You are liable for the HOA dues after the filing until the property changes legal title via short sale or foreclosure. That is why I advise clients to get rid of the home BEFORE filing the BK.
    Answer Applies to: California
    Replied: 2/20/2015
    Freeman Law Group, LLC
    Freeman Law Group, LLC | Derek Freeman
    The house is still in your name until the bank takes action, whether through foreclosure or short sale. The bank is correct that you won't be liable for any deficiency. They want to do a short sale to limit their own loss. Whether you cooperate or not is up to you, but if you want to get rid of the property (and all the HOA dues and property taxes that go along with it), you should go ahead with the short sale.
    Answer Applies to: Colorado
    Replied: 2/20/2015
    Novakov & Associates, PLLC
    Novakov & Associates, PLLC | LINDA S. NOVAKOV
    When a bankruptcy is filed, that discharge only discharges the debt amount for you personally. You are no longer responsible for the payment of the amount due. When there is a security interest taken by the lender in an item such as a home, the Lender would have to file a foreclosure action to request the court allow the real estate to stand good for the debt, and for the Master Commissioner to sell it at auction. Once that process is complete, a deed is transferred to the successful bidder at auction. Filing bankruptcy does not automatically dispose of the property which appears of record in your name. The real estate is still owned by you - if the lender chose not to foreclose and have the property sold - you still own it, subject to the mortgage lien. You have a right to list it with a realtor, or sell it yourself and get the best price - if the owner of the Debt is willing to work with you to accomplish this, it is a good way to get rid of the property and away from any potential loss which may occur from someone getting injured on the property. This is a complex issue and you should seek competent counsel to help guide you through the process.
    Answer Applies to: Kentucky
    Replied: 2/20/2015
    Garner Law Office
    Garner Law Office | Daniel Garner
    Your situation is all too common in our mixed-up housing market today. As you have discovered, filing bankruptcy by itself does not get the property out of your name or relieve you of the obligation to pay ongoing HOA dues (and perhaps other ongoing costs related to the property.) It discharges your personal obligation to pay the mortgage and arrearage on HOA dues owed on the date you filed for bankruptcy. Your best course of action would be to cooperate with BSI Financial and make sure you resolve any outstanding HOA dues. It might be possible to pay the HOA dues from the proceeds of the short sale, but that would require BSI Financial's cooperation. It is unfortunate that your former bankruptcy lawyer did not make these things clear, but you probably would have been required to pay more attorney fees to assist you in getting the property out of your name. The typical retainer agreement in a bankruptcy only promises a discharge of your debts.
    Answer Applies to: Oregon
    Replied: 2/20/2015
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    Look for a new lawyer at NACBA.org. Without seeing the paper work I can't answer this.
    Answer Applies to: California
    Replied: 2/20/2015
    The Law Office of Darren Aronow, PC
    The Law Office of Darren Aronow, PC | Darren Aronow
    Bankruptcy does not take the house out of your name. Only a sale or if you sign the deed over to the bank. Not sure what your attorney told you but it may have been incorrect. And you are liable for HOA fees that accrue after your bankruptcy filing date. Generally, in our firm we negotiate with the lender to do a short sale to get it out of your name and for you to move on.
    Answer Applies to: New York
    Replied: 2/20/2015
    R. Steven Chambers PLLC | R. Steven Chambers PLLC
    The bankruptcy doesn't change title to the property; it discharged the debt on the property. The house is still in your name because you still are the owner. The company is correct - you will have no liability for cooperating in a short sale. They need your cooperation to avoid having to do a foreclosure. As long as you own the property you continue to have liability for any injuries that might occur on it. For example, if someone falls on ice on the sidewalk. You should help the company get the house out of your name. However, before you sign anything you should have an attorney review it.
    Answer Applies to: Utah
    Replied: 2/20/2015
    The Troglin Firm | William M. Troglin
    When you filed your bankruptcy one of the schedules filed was a statement of intention which only deals with secured debt. This schedule states weather you intend to keep the house or surrender it to the lender. I presume you stated that you intended to surrender the house. When the real estate market collapsed in 2008, a new problem reared its ugly head in that mortgage lenders became over whelmed with foreclosed homes that they could not sell so they do nothing and the home owner still has a house in his or her name and, while a bankruptcy discharges the Debtor's liability, you are still responsible for City and County ordinances under which you can be fined for violations and WORST OF ALL you are responsible for any HOA dues that accrue after filing until the title to the house is transferred to another party. The lender, BSI Financial, has two remedies - they can foreclosure on the home and take title or sell it with your help as you are still title holder you are the only one who can sign the Warranty Deed. You cannot force BSI to foreclose or accept title if you simply recorded a deed to them. This is a big problem and you need to contact them offering a deed in lieu of foreclosure and or try and find an investor to offer a contract to purchase. In situations like this I have told my clients that, since they still own the home they can rent it to cover their expenses and recoup prior expenses.
    Answer Applies to: Georgia
    Replied: 2/20/2015
    John W. Lee, P.C.
    John W. Lee, P.C. | John W. Lee
    Bankruptcy does not transfer property out of your name. The house will remain in your name until a foreclosure, short sale or Deed in Lieu takes place. Until the house is transferred out of your name you may be responsible for debts associated with home ownership, such as taxes or HOA fees. It sounds like the house is still in your name. You should have a lawyer review any papers you sign regarding the transfer of property out of your name.
    Answer Applies to: Virginia
    Replied: 2/20/2015
    Scott Goldstein | Scott Goldstein
    Title does not transfer until the house is short sold, sold, or a foreclosure sale is completed. The loan is discharged but the lien remains and the title remains yours. That is why you have to pay HOA dues.
    Answer Applies to: New Jersey
    Replied: 2/20/2015
    Wink & Wink
    Wink & Wink | Gigi Wink
    Bankruptcy does not remove your name from the title of the home, it only removed your liability on the mortgage(s). In order for it to be removed from your name it must be sold to someone else by straight sale, short sale, foreclosure or deed in lieu. Once it is out of your name, you will no longer be liable for the HOA dues, so the short sale is something you may want to consider.
    Answer Applies to: Colorado
    Replied: 2/20/2015
    Michael J. Duggar, P.A.
    Michael J. Duggar, P.A. | Michael J. Duggar
    In the state of Florida, the mortgage company must go through judicial process to regain possession of your house. They have to do that although you have no legal liability on the loan due to the discharge you obtained in 2012. Unfortunately, while the house is in your name, technically all post-bankruptcy HOA dues are due and payable and non-discharged in your bankruptcy. Although you have no obligation to cooperate with BSI Financial, the sooner you can get the property out of your name, the sooner you can stop paying HOA dues. Have you considered letting the HOA take the home to rent it out to pay the HOA dues? Many are not allowed to do that, but why not call them to inquire? In summary, none of this has anything to do with your bankruptcy. It is somewhat the nature of the beast of how things work at present in Florida, although somewhat is quite unfair to you. Just remember, in general, you own the house all the way until a foreclosure sale date.
    Answer Applies to: Florida
    Replied: 2/20/2015
    Law Office of Andrew Oostdyk
    Law Office of Andrew Oostdyk | Andrew Oostdyk
    Your Bankruptcy Discharge Order removes your liability on the Mortgage (and other debts listed in BK), but the Order does not remove your name from the Deed. It is the responsibility of the holder of the note to foreclose on the property and to transfer the Deed into their name. You are under no obligation to work with the note-holder to transfer title through a short sale or other means. If you choose to work with them, that is ok as well. In addition, notify the HOA that you filed Bankruptcy and are no longer purchasing the home. The HOA should have been notified of the BK at the time of filing. But, if they were not, notify them now and stop paying the dues. The HOA can place a lien on the property and try to collect their dues from the note-holder or future purchaser. It is not your responsibility anymore.
    Answer Applies to: Texas
    Replied: 2/20/2015
    John W. Lee, PC
    John W. Lee, PC | Kim A. Lewis
    The deed to the house will stay in your name until it is sold or foreclosed on. The bankruptcy discharged the debt but does not take the property out of your name. You should contact the mortgage company and ask them to begin foreclosure proceedings.
    Answer Applies to: Virginia
    Replied: 2/20/2015
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    The Bankruptcy does not take the Property out of your name. It just alleviates your liability on the Mortgage.
    Answer Applies to: New Jersey
    Replied: 2/20/2015
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