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After divorce/bankruptsy we got back together. Home that was discharged on both bankruptsies was loan modified, however when

Bremerton, WA |

on monthly payment paperwork, it stated for info purposes only, not a bill, even though it was paid as bill. after calling mortgage company many times i was told to refer to bankruptsy paperwork, which stated the house was discharged. we have since moved out, and now are getting notices about the house going into auction soon. Do we owe the difference from when we moved out. Do we owe the difference if house is sold for less than owed. Do we owe nothing, since house was discharged, and mortgage company inclueded the disclaimer on each bill as stated above. Or can we still do a short sale if we owe to mortgage company. The modification agreement we signed does not show up on our credit reports. We are not sure what the answer to any of these is.

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Attorney answers 3


As long as you did not sign a "reaffirmation agreement" in your bankruptcy on this mortgage, you should not have to worry about any personal liability from walking away from the loan. Even if you had signed such an agreement, assuming this is a non-judicial foreclosure, as most are in Washington State, you would not be on the hook for any deficiency on the loan from the foreclosure. Nothing keeps you from listing the property for a short sale if you're interested in keeping a foreclosure off your credit record.

You might want to contact a bankruptcy attorney to take a quick look at your bankruptcy paperwork to give you some clarification.

I am an attorney licensed exclusively in the State of Washington. All information provided should never be interpreted as legal advice with respect to any particular situation. Review all information obtained on this website with skepticism and contact an attorney in your state if you have questions about the subjects discussed.


I agree with counsel. However, bankruptcy is such a different area of law and has changed a lot since 2005, you should find an attorney who does both family law and bankruptcy. That is not uncommon for attorneys to have family law and bankruptcy as a practice. Its not widespread but you should find one who does that.

Attorney Williams practices FAMILY LAW throughout the State of California and may be reached at (831) 233-3558 and offers free consultations. The response provided in this forum is not intended to create an attorney-client relationship. The information offered in this response is for general informational purposes only and should not be relied upon without further consultation with a legal professional after all relevant facts are disclosed and considered. DANIEL S. WILLIAMS, ESQ. LAW OFFICES OF DANIEL S. WILLIAMS 500 LIGHTHOUSE AVENUE, STE. A MONTEREY, CA 93940 (831) 233-3558 -- OFFICE (831) 233-3560 -- FAX


In a typically BK - there is a method to elect to not keep the home. Not clear that you selected that option. There is also the order of discharge that would make you not responsible for a deficiency judgment in a judicial foreclosure. However, in your scenario you indicated that you entered into a modification (NEW) agreement with the lender. It actually sounds like the lender has lost or ignored or not recognized that you entered into the modification. I typed (NEW) because it occurred post petition. In a nonjudicial foreclosure of the first mortgage you will not owe residual monies - the bank will get the home. However, if you want to save your home - you might have some option based on what appears to be a weird situation in which the bank agreed to do something - you agreed to do something - and then they sort of ignored it. In general, this sort of issue is to complicated for this type of forum. Go have a 30 minutes consult with an attorney and bring all the paperwork so that questions can be asked and potential answers can be provided.

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