I'm underwater and see little hope of ever having any equity. I've paid my mortgage for 3 years after the chapter 7 discharge but after seeing the reality of my situation, I am wondering whether or not to go the route of strategic foreclosure.
Talking to your attorney is advisable to get a realistic time frame for the process. Here in MI, at least until the law changes at the end of the year, most folks can count on a year rent free before they can be removed from the home.
Chapter 7 Bankruptcy Attorney
I would advise you to discuss this decision with the bankruptcy attorney who represented you in your Chapter 7 case. Your decision may depend on whether or not you reaffirmed this mortgage debt in that case. If not then your personal liability on the debt was discharged in that case, assuming you received a standard discharge. This means that if you feel your money is better spent obtaining a new living arrangement rather than continuing to sink money into this property the lender would have no recourse against you for personal liability due to non-payment of the mortgage.
The author’s comments are not to be construed as rendering a legal opinion nor proffering legal advice. To obtain legal advice or a legal opinion, you should retain an attorney to consult with you on your particular matter.
The big question is whether you reaffirmed your mortgage or mortgages. If you did then you may have issues with a foreclosure. If you didn't then you can walk away without personal liability. I agree speak to the attorney who represented you to see if reaffirmation agreements are on the docket.
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I have never advised a client, personally, to reaffirm a mortgage. I think it's a terrible idea. If you can afford to pay, you do, and if you don't, you (eventually) move out. If by a "strategic" foreclosure, you mean stay in the house until the very last minute....well, all I can say is that many people are doing it.