Have non homesteaded condo. Currently behind on payments. Bank will not short sale without promissory note. If foreclosure goes through and bank files deficiency judgment, can deficiency judgment be discharged in bankrutpcy?
Yes. Consult a bankrutpcy attorney in your area about your entire financial situation, and what will be required to file bankruptcy and receive a discharge, and what property you will be able to keep.
Yes, however there is more to it than that. Chapter 7 bankruptcy has qualifying limits which are based on the potential petitioner's financial circumstances at the time of filing of the bankruptcy case. Chapter 7 is normally the preferable bankruptcy chapter for consumers to discharge these sorts of debts. It can take quite a lot of time before the deficiency judgment issue is raised by the mortgage company, even years. If by then the economic situation has improved, you may not qualify for bankruptcy, even if you do now. So, if you wait, you may not qualify for Chapter 7 at that point even if you do today. If you are inclined to file bankruptcy, you do not have to wait until they are after you and risk the problem of not being able. The qualification standards for Chapter 7 are strict, so the best time to be evaluated is while your economic circumstances are at their worse. If you are able now, you should consider getting evaluated by an experienced bankruptcy attorney to file now and get rid of the problem. All of the mortgage companies have made it clear that they WILL be pursuing deficiency judgments, whether they have started yet or not.
The best way to deal with a deficiency judgment is to never get one in the first place. Let us consider your current financial situation to be a glass vase sitting dangerously close to the edge of a table. If the filing of a foreclosure lawsuit against you knocks the vase off the table … “foreclosure defense” is an effort to catch the glass before it hits the floor. A bankruptcy lawyer is the guy (or girl) who shows up later with a broom to sweep up the broken glass.
Foreclosure is a court of equity. A court may deny a deficiency judgment to a Lender/Plaintiff that comes to a court of equity with unclean hands. When a homeowner’s attorney asserts a vigorous defense lenders usually are willing to give up claims for a deficiency in exchange for an agreed judgment of foreclosure. Our firm has obtained waivers of deficiency for upside down investors ( who had sufficient salary income to pay their mortgage but were tired of throwing good money after bad ). At this point you need you need asset protection planning so that your assets will be safe in the worst case scenario that a deficiency judgment was entered against you. For high net worth clients our firm’s offices in Miami, Plantation, and Melbourne work with a number of local financial planners to help implement asset protections strategies. You also should retain a foreclosure defense attorney work on preventing the lender from obtaining a deficiency. A Chapter 13 bankruptcy can be a useful tool for some homeowners to eliminate second mortgages. Chapter 7 bankruptcy is usually the wrong answer for most homeowners.
The best way to deal with a deficiency judgment is to never get one in the first place. Let us consider your current financial situation to be a glass vase sitting dangerously close to the edge of a table. If the filing of a foreclosure lawsuit against you knocks the vase off the table … “foreclosure defense” is an effort to catch the glass before it hits the floor. A bankruptcy lawyer is the guy (or girl) who shows up later with a broom to sweep up the broken glass.
Foreclosure is a court of equity. A court may deny a deficiency judgment to a Lender/Plaintiff that comes to a court of equity with unclean hands. When a homeowner’s attorney asserts a vigorous defense lenders usually are willing to give up claims for a deficiency in exchange for an agreed judgment of foreclosure. Our firm has obtained waivers of deficiency for upside down investors ( who had sufficient salary income to pay their mortgage but were tired of throwing good money after bad ). At this point you need you need asset protection planning so that your assets will be safe in the worst case scenario that a deficiency judgment was entered against you. For high net worth clients our firm’s offices in Miami, Plantation, and Melbourne work with a number of local financial planners to help implement asset protections strategies. You also should retain a foreclosure defense attorney work on preventing the lender from obtaining a deficiency. A Chapter 13 bankruptcy can be a useful tool for some homeowners to eliminate second mortgages. Chapter 7 bankruptcy is usually the wrong answer for most homeowners.
I strenuously disagree with Attorney Schuster. More and more, when people do not live ia property in foreclosure any longer, or never did, or are extremely upside down and don't want to get involved in extensive litigation and are prepared to go elsewhere to live, Chapter 7 can be the perfect solution. When done properly for a person or couple who qualified for Chapter 7 and discharged, it completely disposes of all personal liability on mortgages and unsecured debt. When people who fit the profile for Chapter 7 want a "frest start" a Chapter 7 bankruptcy case can be the exact right answer.
