My ex-wife filed for Chapter 7 Bankruptcy. She currently lives in the house we bought together and is permitted to live there until August 2019 when spousal support ends. Both of our names are on the deed, but i am the sole debtor on the mortgage. Because of this, Chase Mortgage has put a remark on my account, causing my credit score to drop 60 points. I am planning to dispute, however i have been told that getting my ex-wife's name off the deed through a quitclaim deed would also help. She has agreed to sign a quitclaim. Per divorce settlement, we are both entitled to any profit or penalties as a result of the sale of the home. I have no plans to go against the terms laid out in the divorce settlement. Would a quitclaim deed be advisable in this situation to help fix my credit?
You have no way to sue her because she filed for Chapter 7, since it is her right to do so under Federal law. A quitclaim deed is not worth the paper it is printed on and changes nothing. If you want to save the house for yourself, you need to retain an attorney who practices both complex Chapter 13 Bankruptcy and mortgage foreclosure defense. This is the only type of attorney who can effectively use the Bankruptcy Court's mortgage loan modification program. If you do not want to save the house, depending on your overall financial situation, then a Chapter 7 Bankruptcy may be right for you. But you need to have an in person consultation prior to taking any action. Do not let geographic restrictions get in the way of retaining the best attorney. Pick the best attorney you can find and remember one rule: a good attorney is generally never cheap, and a cheap attorney is generally never good so don't choose based on price.
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Your credit should not be affected by HER bankruptcy since you did not file. Assuming the mortgage is kept current, there should be no affect in your credit score. First step is to dispute with the credit bureaus the fact that your account is flagged for bankruptcy. If that doesn't help contact a consumer attorney to help file suit against them for violating the Fair Credit Reporting Act. A quitclaim deed will do nothing to fix this situation.
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