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Do I need a lawyer for foreclosure or can I just let the process play out? I filed bk, house is included and no discharge yet.

Crystal Lake, IL |

My husband and I lost a business in 2009. We had to file personal BK due to business debt - not discharged yet. The house has business liens on it and the foreclosure process has started. Lawsuits from our mortgage company and from the HELOC were filed in January 2010. Our BK attorney says to let the process play out and said we don't need to respond to anything related to the foreclosure, no need to show up to court or respond at all. We feel uneasy about his advice -- do we need someone to represent us in the foreclosure even though we are not going to be able to keep the house or attempt to modify the loan? It doesn't seem right to just ignore the legal stuff we keep getting. Our attorney seems annoyed when we ask questions, because of that I don't feel confident in his advice.

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Attorney answers 1


A mortgage company typically has a lien on your home they can foreclose on (giving them the right to take the home) and a personal action they may assert against the people who signed the note (you and your husband--however in "nonrecourse" states there is no ability to go after the individuals and even in many recourse states it's hardly ever done).

Even in bankruptcy they can still take the home (Chapter 13 will let you strip away some loans and liens but after BK "reform" the first mortgage is sacrosanct even there, unfortunately) ... filing a suggestion of bankruptcy with the foreclosure court that would stay the proceedings would usually be a temporary impediment at best (the mortgage company would apply to the court to have the stay lifted) so unless you were in a position to cut a deal with the mortgage company and just needed some breathing room there would be little point.

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