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Mortg. co. denied deed in lieu on fha loan. If foreclosed am I still responsible for loan & how will it affect my student aide.

Capitol Heights, MD |

Tried modification on fha loan. They gave me unattainable modification then said they would not do it again because 1 year had not passed. Accepted terms for deed in lieu. After 3 mos. I received notice I was unqualified. If I file bankruptcy, am I still liable for home loan and how will bankruptcy or foreclosure affect my student aide?

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Attorney answers 3


The prior attorney's answer is correct. You can discharge any remaining liability through bankruptcy. Just be careful not to try to do the bankruptcy yourself or with just a paralegal service. Hire a lawyer, because bankruptcy may fix one problem only to cause another.

Brenda Susan Nelis

Brenda Susan Nelis


If you do discharge the associated debt in the bankruptcy, please remember you may still have title to the property until foreclosure proceedings have concluded even though you are surrendering the home as part of a bankruptcy proceeding. This means you could still be responsible for accruing property tax and any HOA fees until the property is transferred out of your name. How bankruptcy and foreclosures effect your ability to obtain financing on student loans is directly dependent on what type of student loan you are seeking to obtain. Private loans and Federal Loans differ greatly in their accessibility. I would also suggest you contact an attorney to receive a consultation. Many bankruptcy attorneys offer free consults.


Bankruptcy will discharge any liability for a deficiency on your home mortgage. Neither should affect your ability to receive any form of student loan benefits.


I agree with my colleagues that bankruptcy will discharge this debt. I also agree with my colleagues that neither should affect your student aide.

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