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My husband has to file bankruptcy for medical debt. We are in foreclosure. He is on the mortgage but not on the note.

Hoffman Estates, IL |

I am on both the mortgage and the note. I filed chapter 7 last spring but we could not for him because of a probate case. Curious if the auto stay will go into effect again -- being that he is only on the mortgage but not on the note. We are deemed "tenants in common". Just curious.

Attorney Answers 3

Posted

Yes, if your husband is on the deed, he should list the mortgage company as a creditor even though he isn't on the note and the automatic stay will apply. Hope this perspective helps!

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Posted

I think you were accidentally inaccurate when you stated above that. "I am on the mortgage and the note." If you filed a Chapter 7 Bankruptcy last Spring, then you are NOT on the note or the mortgage anymore. Those obligations were "discharged" in the Chapter 7 Bankruptcy as to you, personally.

Interestingly, your name remains on the deed at the County Recorder and will remain so for some time. You can check me out. I'm right. Your name will remain on the deed, until the bank accepts a deed from you or the bank completes a foreclosure against the property that changes the formal title out of your name.

When your spouse files a Chapter 7 Bankruptcy, he will find that his name remains on the deed, just as your name does. I know this is complicated, but that's what attorneys are for. Good luck.

Don't forget to click on the "Best Answer" button, if you appreciate this wit and wisdom. This answer is not intended to create an attorney-client relationship and may not be relied upon as legal advice. A careful examination of the facts is necessary before a legal answer may be relied on. You should consult your own attorney before taking or refraining from any legal action.

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1 comment

Barbara Lee Franklin

Barbara Lee Franklin

Posted

I agree; however, the mortgage will still encumber your interest in the property, just as it will remain after your husband's bankruptcy. The mortgage only allows them to realize on their security by looking to the property and not you personally. they usually will add both parties to the mortgage even if they are not signing the note because both parties are on title and would be named in a foreclosure suit.

Posted

Yes, the stay should go into effect again. If I own a property that has a mortgage on it, then that mortgage cannot be enforced against my property, even if I didn't sign the mortgage. The reason is that the property itself is protected by the bankruptcy. Note that the bank may still be able to go after the property if it moved for and obtained relief from the stay in your case. Then they may be able to have the court grant them relief again in this case.

You should ask your husband's bankruptcy lawyer these things.

This answer does not create an attorney-client relationship or imply that I am licensed to practice in your jurisdiction. It is merely for informational purposes. You should contact a local attorney for legal advice.

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