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Yes, you can file a Chapter 7 to have the debt liquidated or a 13 to go into repayment.

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Q: You sold your house in a short sale The first mortgage was forgiven but the second was an equity line The bank said you had a mortgage dificiency Can you file bankruptcy now for the deficiency?
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Are you able to still leave a mortgage in Minnesota after BK and not be liable?

Yes, you can walk away from a mortgage and not be liable for a deficiency (even in recourse states) if the mortgage was listed in the bankruptcy.


Is a 1099 a considered debt forgiven?

If a debt is "forgiven," it is income to the debtor, and a 1099 is issued by the mortgagee or the creditor. You may not have to pay it, even if you don't file bankruptcy, if the debt was a mortgage on your residence.


Are mortgages in Indiana non-recourse?

If the deficiency is forgiven by the lender, is it still subject to federal and state tax? The mortgage preforeclosure short sale closing date was in 2005.


Do both parties on a joint mortgage have to file bankruptcy on a joint mortgage?

No, both parties on a joint mortgage do not need to file bankruptcy. They can file a joint bankruptcy or a single bankruptcy.


Will bankruptcy protect me from foreclosure by my mortgage company?

Yes, bankruptcy protect you from foreclosure by your mortgage company. You can read more at www.hirby.com/mortgage-lender-filing-for-bankruptcy


Should you file bankruptcy when there is a foreclosure and pending divorce situation and you do not want to keep the house and can not repay any money still owed to the lender?

If the mortgage is in both names, or if there is significant joint debt, you are better off filing bankruptcy jointly before the divorce is final. If the mortgage company forgives the balance, it will count as income to you and you will have to pay taxes on it in the following year, unless you file bankruptcy. Or the mortgage company can sue on the deficiency and get a judgment good for 10 or 20 years. Unless you file bankruptcy.


What causes Mortgage defaults to rise?

In the USA there is speculation that the 2005 bankruptcy reform caused an increase in mortgage defaults. By declaring bankrupty, homeowners can keep their homes. The problem created in 2005 occured when filing fees were raised and a lower amount of debt was forgiven.


If you filled for bankruptcy then modified a mortgage can the mortgage company come after you or will it still be in your bankruptcy?

Great question for your BK attorney


What if you file bankuptcy and have a reverse mortgage?

The reverse mortgage is typically unaffected by the bankruptcy as the mortgage is usually left out of the bankruptcy- that is a conversation you need to have with your attorney however. The bankruptcy court may look at the amount of equity you have in your home and determine what type of bankruptcy you qualify for. A reverse mortgage can even be used to pay off a bankruptcy or a mortgage in foreclosure as there are no credit requirements on them. I suggest talking to a bankruptcy attorney for information on what is available to you from the courts side of things.


What happens to a mortgage after a bankruptcy?

What happens to a mortgage after bankruptcy depends on whether or not the debt is reaffirmed. If the mortgage is reaffirmed the homeowner continues to pay it as if the bankruptcy had not been filed, since the debt has not been discharged. If the debt is not reaffirmed, what happens to the mortgage depends on the policies of the individual lender.


Is there some type of protection against paying a deficiency judgment under chapter 7 bankruptcy law if you filed chapter 7 before the foreclosure in Illinois?

If you reaffirmed the mortgage in the c. 7, which went to discharge and was closed, no, other than possibly filing a c. 13 to arrange to pay the amount due. If the mortgage company received relief from stay while you were in the c. 7, the deficiency was discharged with the other unsecured debts. If you had a bankruptcy lawyer, ask him or her.


Can you get a mortgage loan if you are in a chapter 13 bankruptcy?

If you are lucky, yes. But most likely, no lender will give you a mortgage loan if you are or have declared bankruptcy.