We got our Ch.7 discharged back in November, 2009. We are now thinking about walking away from our home. We did not reaffirm through the bankruptcy. However, our mortgage was held through Universal Mortgage at the time, they since then sold to US Bank. Universal Mortgage was included in the bankruptcy. Can we walk away and not be held liable? Will this be another hit on our credit on top of the bankruptcy?
The discharge you received should have included all your creditors, including your mortgage. Although you voluntarily made payments once the bankruptcy was completed, this did not rescind your discharge. When the mortgage company sold your loan, they only sold what they had, which was a mortgage secured by your real estate, but without you remaining personally responsible to pay the debt.
Hope this perspective helps!
Dorothy is right, since you entered into the mortgage contract before filing and did not reaffirm you are not personally liable for any potential deficiency. Furthermore, your credit should not be affected since you are not personally liable for the debt and the bank can not report any default on a debt that was discharged. Good luck!!
General Practice Lawyer
If you were represented in your bankruptcy, you should confirm all details with your attorney. Otherwise, if you are stating the facts correctly, which is consistent with the way things usually would have went, you will not be responsible for any mortgage obligations on the home if you surrender it or allow it to go through foreclosure. If you have not done so, you should also explore whether there is any advantage in alternatives, such as a loan modification request to the US Bank, a deed in lieu of foreclosure, or a short sale.