Posted on: 02nd Apr, 2010 09:10 am
i am the co-owner of a property of a home that i haven't lived in for two years. the other owner remained in the house however lost his job, quit making the payments and then 4 months ago filed chapter 7 bancruptcy. since my name is still on the house and i cannot pay for it, i want to do a deed in lieu of foreclosure to just be done with this whole nightmare. i want to know what i need to do and how it will affect me in terms of penalties and taxes.
If your name is not on the mortgage docs, then you are not responsible for the payments. The lender will not come after you for the payments though the co-owner files bankruptcy. Also, you should note that if your co-owner had already filed bankruptcy, then the lender will not consider your request for a deed in lieu of foreclosure as there will be an automatic stay on all the creditors.
My name is on the mortgage docs. What do you mean when you say there is an automatic stay on all creditors? What do I need to do next in order to get rid of this property?
Hi agreene,
Once you file bankruptcy, the court will issue an automatic stay on all your creditors. Thus, your creditors will not be able to take any actions against you unless your bankruptcy has been discharged. As the property is in bankruptcy, you won't be able to get rid of it now. You'll have to wait till the bankruptcy gets discharged and then try to sell it off.
Take care.
Once you file bankruptcy, the court will issue an automatic stay on all your creditors. Thus, your creditors will not be able to take any actions against you unless your bankruptcy has been discharged. As the property is in bankruptcy, you won't be able to get rid of it now. You'll have to wait till the bankruptcy gets discharged and then try to sell it off.
Take care.