What happens to a home mortgage if the co-signer does not file bankruptcy but has credit problems?

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.

The loan would be part of the bankruptcy filing. I can't see how the death of the cosigner is significant. (In financial terms, that is.)

Nothing unless they filed on your loan.

Her mortgage liability will be discharged.

If you default on your loan, the cosigner is stuck with paying it off. If your credit had been any good in the first place, you would not have needed a cosigner.

A reverse mortgage is typically unaffected by bankruptcy. Only in a case where you want to surrender the home would the bankruptcy court be involved on any mortgage product other than to dictate terms of repayment of defaulted payments. with a reverse mortgage there are no payments so that would not be an issue.

They can still come after the cosigner, and it will still reflect poorly on your cosigner's credit history. You have been absolved of the debt, not your cosigner.

you are still liable for that loan. the lender may decide to not accept the bankruptcy charge and go after you for the money.

When you co-sign on a loan or mortgage for someone, you are promising to make the loan payments if they can't. When someone files for bankruptcy, they are claiming that they cannot make their payments. It would stand to reason that if someone you co-signed on a mortgage for files for bankruptcy that you would then be liable for making the payments.

You are protected during the term of his bankruptcy. If he does not resolve the debt under it, you will remain responsible.

Assuming this is a straight bankruptcy, the mortgagee would lose the money that is owed to it on the mortgage loan. A bankrupt person or corporation loses all of his/her/ its assets to the Trustee in Bankruptcy so that the Trustee can liquidate those assets and distribute the net proceeds to the creditors. The mortgage loan is an asset which is then sold to the highest bidder along with the mortgage lien. The mortgage holder…

Mortgage notes are considered a company asset and are transferred or sold to other servicing lenders. Most mortgage companies only service loans for investors "fannie mae, Freddie Mac, etc."

what happens when you file bankruptcy and your second home you own as an investment is placed in the bankruptcy by mistake the house getsfor closed on and sold but no title search is done to see that there are actually two mortgages on the house who is responsible for the second mortgage

This confuses two different concepts. A "charge off" is an accounting and tax term that means the creditor does not believe a debt is going to be repaid. It gives the lender a tax deduction. A discharge in bankruptcy is a permanent injunction against a creditor taking any action to collect a debt, including debt collection agencies or successors/purchasers of a discharged debt. Assuming the refi of the mortgage happens after discharge, nothing happens. If…

The creditor wil try to get the debt from the cosigner as well.

The short answer is, nothing good. As a co-signer, you are still responsible for making sure the mortgage payments are made in full on time. However, you should talk to the bank that holds the mortgage to see what you need to do, particularly if the title of the house doesn't come to you through the will or settling of the estate.

Bankruptcy has nothing to do with the tenant. If a bank forecloses on the mortgage, US federal law requires the bank to give the tenants a 90 day notice to quit, if they want the building emptied. But, it could be that the landlord will survive the bankruptcy, and there will be no foreclosure.

Was the 2nd lien included in and discharged in your bankruptcy? If not, then that lien still encumbers the title to the property and is probably a debt you still owe.

A C-11 is normally only for Corporations. It is a re-organization type of BK. The mortgage is like any other secured debt, and the creditor will be paid by the agreed terms of the reorg or get the property.

It sounds like your name was on the deed, you mortgaged the property then you conveyed it to your spouse thinking to effect a change in ownership free of the mortgage. You can't do that. A conveyance to defraud your creditor will be "undone" by the court. Also, if you did transfer ownership subsequent to granting a mortgage the transfer is subject to that mortgage. Your bankruptcy won't simply wipe out your mortgage and make…

First and foremost, you cannot remove a "co-signer" of a mortgage from the obligations of the mortgage. They may release their interest in the property by signing a deed but that doesn't release them from their obligation to pay the mortgage. This type of situation often happens in a divorce when the parties have a poorly drawn agreement that one will convey their interest to the other and the other will take responsibility for the…

You can either try to modify your 13 plan payments, convert to a chapter 7, or dismiss your BK.

See http://www.fivecentnickel.com/2008/09/22/what-happens-to-your-mortgage-if-your-bank-fails/

They both go bankruptcy

Nothing happens to it. It still remains in second place.