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I filed for bankruptcy last August the house was surrendered , it was discharged last October .

Saint Petersburg, FL |
Filed under: Chapter 7 bankruptcy

The bank is still contacting me and wants to do a short sell or $ 3 , 000 . 00 , " maybe more " to do the cash for keys ! If I do the cash for keys , will that effect or change anything with my bankruptcy since the house was already included ?

Attorney Answers 4

  1. Best answer

    Be careful what you sign. New agreements signed are after the bankruptcy and could create new obligations. You can do it but be careful. The best advice is to have an attorney review the documents before you sign them

  2. No. Accepting the cash for keys offer shouldn't affect your bankruptcy discharge. Even after a bankruptcy is filed, the bank still has to file a state court foreclosure action against you to take the home. There is no reason for you to short sell the property, since you have filed for bankruptcy and all debt owed to the bank can no longer be collected against you. You may continue to occupy the home until legally evicted through the foreclosure process, but you may prefer to move sooner with the cash for keys offer, which will benefit both you and the bank, since it will cost them less to recover the house.

  3. No, the cash for keys should have no affect on your bankruptcy discharge. You should consider whether the amount they are willing to pay you offsets whatever rent you would have to pay in the time between now and whenever they would eventually get around to foreclosing if you do not do the short sale and the cash for keys. Effectively you could continue living there for your HOA dues, homeowners insurance and taxes which could be less than you'd have to pay for rent.

    DISCLAIMER: This message is intended as a general discussion of legal issues and not as a statement of fact, legal advice or a legal opinion. No attorney-client relationship is created by this message. Do not act or rely upon law-related information in this communication without seeking the advice of an attorney licensed to practice in the relevant area. I am a Federally Designated Debt Relief Agency under the United States Bankruptcy Code. I proudly help people in financial need file bankruptcy cases. IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (or in any attachment) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication (or in any attachment).

  4. I feel it is important to point out that there is a big difference between signing the bankruptcy paperwork saying that someone "intends to surrender" property and the actual surrender of the property. Some bankruptcy trustees are arranging for the "short sale' of underwater properties when the debtors say they intend to surrender & taking the "cash for keys" money to pay the debts. Be sure your case is actually closed and that your trustee doesn't have his/her own plans for the property. Hope this perspective helps!

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