Q: I filed bankruptcy, and the case was discharged about a year ago. I am still not making any payments on my home and the bank has not taken possession or finished the foreclosure. Can my mortgage lender come after me for money? – Rober

A: No. While a bankruptcy will relieve you of the liability to repay your lender, the mortgage lien still remains valid. This means that your lender still needs to foreclose its mortgage lien in order to take possession of the property. You can still defend yourself in this foreclosure, and you still may even be able to work out a loan modification where you agree to pay back only part of the debt that you were relieved of in bankruptcy, but you get to keep the house. Bankruptcy is often referred to as a fresh start, and you may be able to use this opportunity as a chance to restart your ownership of the home, but at a payment that you can afford.

Q: I own my home with my ex-boyfriend. He has long since moved out and I am living there paying the small mortgage. Believe it or not, we actually owe significantly less than the home is worth. I want to sell the house and use the proceeds to move and buy a new home. He is not cooperating. Is there anything I can do? – Delia

A: Yes. You will need to get court intervention and file a “Partition” lawsuit. In this type of lawsuit, you will be asking the judge to order the house sold, and the money generated from the sale to be divided fairly. The good news is that it can be done; the bad news is that you will have to pay attorney fees and court costs to make it happen. I always recommend that when people who are not married buy property together, a simple partnership agreement be drawn up in advance that predetermines what will happen if a disagreement about the property occurs. Beforehand is the best time to determine what will happen to the home if one owner dies, if you break up or any other contingency occurs. Then if something happens, you will have to spend a lot less money to get it fixed.

Q: My husband and I got married, and he applied for a mortgage. He insisted I sign it too as the bank would not approve it without my credit. The house is “underwater” now. He passed away without my name on the property, so basically he is still the owner. I can't afford to pay the loan or an attorney to represent me. The bank filed for foreclosure and I'm waiting to be kicked out to the curb. What will happen to me? – Kary

A: It sounds like you are not on the title to the property, but are still liable under the loan. As a borrower, you are entitled to defend yourself in the foreclosure lawsuit, and I strongly recommend that you do so. If you don’t, not only will your lender take back possession of the house, but you may end up being personally liable for any shortfall between the value of the property and the amount that is owed to the lender. Because this lawsuit involves someone who passed away, it is more complicated than the average foreclosure, and an attorney might be able to negotiate an agreement with the lender. You should check with a few local attorneys for free consultations. I have found that people are often surprised at how affordable a good attorney can be. It does pay to shop around. Also, if your income is around or below your state’s poverty level, you should check with your local legal aid organization or bar association. There may be free or low-cost representation available to you.

The information and materials on this blog are provided for general informational purposes only and are not intended to be legal advice. No attorney-client relationship is formed, nor should any such relationship be implied. Nothing on this blog is intended to substitute for the advice of an attorney, especially an attorney licensed in your jurisdiction.

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