Posted on: 24th Sep, 2009 09:22 am
If I have no equity in my home and I file for Chapter 7 do I have to repay the debt??
Hi Guest,
Though you file Chapter 7 bankruptcy, the lender will still hold the lien on the property. If you reaffirm the mortgage, then you would become personally liable for the debts. In such a situation, you will have to repay the debts. However, if you do not reaffirm the debts, you are not personally liable to pay the dues. You can surrender the property to the lender and he can sell it off to recover his dues.
Though you file Chapter 7 bankruptcy, the lender will still hold the lien on the property. If you reaffirm the mortgage, then you would become personally liable for the debts. In such a situation, you will have to repay the debts. However, if you do not reaffirm the debts, you are not personally liable to pay the dues. You can surrender the property to the lender and he can sell it off to recover his dues.