Mortgages not reaffirmed after bankruptcy- can I sell?

Guest 0.10 Dollars($)

I filed bankruptcy in 2006 nov. discharged in early 2007. before I declared bankruptcy, got 2 mortagges – one from a lender, the other one is a no payment forgiveable rehab loan from the local hosing dept. the loan incurs no payments at all and is reduced by 10% after every 4 years. The total loan period for the second is 12 years. I got the rehab loan around 6 years ago. Now the question is, I didn't reaffirm any of the loans nd stayed in the house. I would like to sell the home. But it won't sell enough to cover both the loans. What will happen? Can I be sued for unpaid debt? Will the housing dept. come after me for payment on the rehab loan?

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi Clark,

Welcome to the forum.

If you cannot pay off both the lenders then why are you willing to sell the house? As you have not reaffirmed you do not have any personal liability to the lender. You can simply walk away if the lender forecloses.

I think you cannot be sued for the unpaid debt as you have not reaffirmed the mortgage.

Feel free to ask if you have any further questions.

Best of luck,
Larry

Guest 0.10 Dollars($)

If the housing dept. has forgiven the debt, it won't come after you for any payment.

"Can I be sued for unpaid debt?"

You mean for the mortgages? probably the lender would go for foreclosure and if the house doesn't sell for the combined loan balance, then he may sue you for the deficiency judgment.

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