Bankruptcy - My mortgage loan was not reaffirmed (chapter 7)

Asked over 2 years ago - Denver, CO

I file Bankruptcy and it was discharged like 2 years ago it was chapter 7. My mortgage loan was not reaffirmed but I have been making my payments on time ever since. Now, I want to move out of the state, can I just walk away from the house and still have the protection of the BK on the mortgage loan balance?. I have a FHA loan. Can I still buy on another state after this? i would like to buy right away...
Thank you,

Attorney answers (5)

  1. James Portman Webster

    Pro

    Contributor Level 15

    5

    Lawyers agree

    Answered . As for mortgage, you don't personally owe money. If there are HOA issues or is there is personal liability for your property taxes, that may be different.

    You can always buy if you can convince a lender to lend.

    Under these circumstances, it would help you to make a call to a mortgage broker to determine your options. THis is a sticky spot.

    Please contact me directly with document for a free 30 minute consultation to get more concrete advice. This is... more
  2. Steven Anderson Leahy

    Pro

    Contributor Level 17

    4

    Lawyers agree

    Answered . If a debt was discharged in bankruptcy - not reaffirmed - the creditor is forever prohibited from collecting on that debt. Whether you can purchase another home, depends on your credit score, the lending institution and availability of money. These days, even people with very good credit are finding it difficult to obtain a home loan. Good luck!

    I hope this helps.
    Respectfully,
    Steven A. Leahy
    chicagotaxteam.com

    Please note that the above is not intended as legal advice, it is for educational purposes only. No attorney-... more
  3. Dorothy G Bunce

    Pro

    Contributor Level 20

    3

    Lawyers agree

    Answered . The better way to handle this is to apply for a new mortgage before damaging your credit by letting the old mortgage go into default.

    Have you considered the possibility of a short sale of the property as a way to resolve this?

    Hope this perspective helps!

  4. Stephen Clark Harkess

    Contributor Level 20

    1

    Lawyer agrees

    Answered . You can walk away from the house without owing any deficiency. However, the subsequent foreclosure will make it difficult to buy another home immediately. The new lender is not going to like to see that you simply walked away from the home. This is a situation where a short sale might look better to a potential lender.

    You can reach Harkess & Salter LLC at (303) 531-5380 or info@Harkess-Salter.com. Stephen Harkess is an attorney... more
  5. Marc Gregory Wagman

    Contributor Level 17

    2

    Lawyers agree

    Answered . Purchasing depends on your credit score among other factors. Your personal liability for the mortgage was discharged if you didn't reaffirm. However, the property must still go through foreclosure if you default. You may want to speak with a real estate lawyer to see if a deed in lieu or a short sale can be accomplished. You won't be liable for mortgage payments but homeowners association dues or condo fees are your responsibility if there are any until the deed transfers in a foreclosure.

    The response given is not intended to create, nor does it create an ongoing duty to respond to questions. The... more

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