'if my recent ex husband files for bankrupcy and our house is in forclosure, how does this affect me?

Asked by Kg33, 85257 Tue Sep 7, 2010

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Sigrid Garri…, Agent, Rochester, MI
Tue Sep 7, 2010
Yes you would need to discuss this with a lawyer. Laws vary from state to state as well.

This is your ex husband but you own the house together? you said our house. Is your name on the deed? Is your name on the mortgage? Who is making the payments?

I am from Michigan so I can speak for Michigan. If your name is on the mortgage, then your credit score will be affected. You or he can sell if on a short sale. The listing agreement has to be in the person's name that is on the deed. Letting a house go into forclosure is the last thing you or your ex-husband want. It will ruin your credit. Selling it on a short sale will hurt your credit as well but only about half of what a foreclosure will do. If your name is not on the mortgage or the deed then he can let it go into foreclosure. If it does, There will be a Sheriff's sale. Before the sheriff's sale it has to be advertized 4 or 5 times in a legal newspaper. After the sheriff's sale there is a redeemtion period usually 6 months(that can vary). The bank can take it in as little as a month after the sheriff's sale if the home is vacant. I think you & your ex-husband need couseling with a good real estate agent familiar with short sales & foreclosures & a good lawyer as well. When looking for a real estate agent. Look for the SFR certified Realtor. That stands for Shortsale foreclosure resource.
1 vote
Jason Whaley, Agent, Mesa, AZ
Mon Nov 8, 2010
It depends if you are on the note or not. If not, no worries, if you are, it is already in foreclosure so you would be accountable for the missed payment and a possible deficiency. Check with an attorney asap.
Web Reference:  http://www.SearchAZmls.com
0 votes
Jon Griffith, Agent, Scottsdale, AZ
Thu Sep 16, 2010
You need to talk to a bankruptcy attorney for that information.

One of the problems you'll face is that if you were both on the note, and you both own the home, and the divorce decree awards you the home, but you aren't able to be removed from the note, then anything that happens that your names are both attached to will affect you adversely.

If the home is your name only, get it on the market and short sale it as fast as you can. If the note is in both of your names, then you'll need to negotiate with them to let you out of the note.

Bankruptcy typically throws a wrench in the short sale process, but honestly, I'm not sure how it would affect you if you were both on the note, but only you were on the deed of trust.
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Bob Movin-On, , Hartford, CT
Tue Sep 7, 2010
Are you on the mortgage? Here it is!!

Ramifications of Foreclosure, Short Sale or Deed-in-lieu-of Foreclosure

Here are some of the ramifications of foreclosure, short sale or deed-in-lieu-of-foreclosure, there are many more like; insurance rates, your job (yes employers are checking credit records these days).

Your credit score will be reduced by 200-400 points, short sale and deed-in-lieu-of a little less 100-200 points.

All forms of foreclosure stay on your credit report for 10 years.

After you have gone through foreclosure, short sale or deed-in-lieu-of-foreclosure there will be what is known as the "waiting period", this period of time varies for each and can be reduced if you had some type of extenuating circumstances that caused the foreclosure:
Waiting Periods to Buy After Foreclosure – “YES” Short Sale and Deed-in-lieu-of are forms of foreclosure
• Buying after a Walk Away Foreclosure
The waiting period is 7 years
• Buying after a Foreclosure
The waiting period is 5 years with 20% deposit up to 7 years.
• Buying after a Foreclosure with Extenuating Circumstances
The waiting period is 3 years with 10% deposit up to 7 years.
• Buying after a Deed-in-Lieu-of Foreclosure
The waiting period is 2 years with 20% deposit, 4 years with 10% deposit up to 7 years.
• Buying after a Deed-in-Lieu-of Foreclosure with Extenuating Circumstances
The waiting period is 2 years with 10% deposit.
• Buying after a Short Sale
The waiting period is 2 years with 20% deposit, 4 years with 10% deposit up to 7 years.
• Buying after a Short Sale with Extenuating Circumstances
The waiting period is 2 years with 10% deposit.

In addition to the waiting period and minimum down payment, you will be required to have a minimum FICO score and the home purchase must also be the principal place of residence, not a rental nor a vacation home.

Lastly, most loan applications will ask the dreaded question "Have you ever been foreclosed on?" this stays with you for life, many think that because it will not show up on the credit report after 10 years they can answer "no", well lying on a loan application is a felony that carries a major jail term, so be aware.

Good Luck
Bob Patrick
Buy a home after foreclosure expert
0 votes
Doug McVinua, Agent, Gilbert, AZ
Tue Sep 7, 2010

The answer to your question requires so many details and because of the legal aspects involved an attorney is the best place to get qualified advice for you situation.

I do know of one attorney group that does free seminars on Foreclosure, Arizona Short Sale and Arizona Bankruptcy that I could get you into if you would like. They are very informational seminars followed by a discount on a consultation if one is needed. Not high pressure, full of information and free.

Let me know if you would like more information.

Doug McVinua



Web Reference:  http://www.McVinua.com
0 votes
Michelle Moz…, Agent, Santa Rosa, CA
Tue Sep 7, 2010
Hi Kg33,

Just as a sidenote: Arizona law is very different, I can now deduce from the well-meaning Michigan agent's response, from Michigan law and process.

Again: Please speak with your attorney.
0 votes
Michelle Moz…, Agent, Santa Rosa, CA
Tue Sep 7, 2010
Hi Kg33,

Every broker and salesperson response will be the same: Please contact your attorney!

Though real estate is a primary component of your question, bankruptcy is a legal process which requires a lawyer's, not a Realtor's®, advice and assistance.
0 votes
Sandra Paulow, Agent, Pinetop, AZ
Tue Sep 7, 2010
You should contact an Attorney with that question. There are a lot of variables in the equation. A divorce decree doesn't necessarily release you from the responsibility for the note on a house that you both owned. You should talk to your divorce attorney and ask them, they should be able to clarify the situation for you.
0 votes
Lyle Wolf, Agent, Morristown, NJ
Tue Sep 7, 2010
What is your ownership interest the house? I agree with Stephanie. You need to confer with an attorney regarding your rights and obligations.
0 votes
Stephanie We…, Agent, Gilbert, AZ
Tue Sep 7, 2010

There would be many answers to this question and more than likely is a question for an attorney, not real estate professionals.
0 votes
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