You can sell if you didn’t reaffirm but there are consequences of not reaffirming a mortgage with the mortgage lender.
But, understanding the right strategies and legal details helps tackle this challenge well.
With our deep guide, you should find the answer you need.
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Can I Sell My House if I Did Not Reaffirm? 14 FAQs Answered
Yes, you can sell your house even if you did not reaffirm the mortgage after bankruptcy. Legally, you are still the owner of the property and you aren’t personally liable for the property if you didn’t reaffirm. Yet, it’s a complex path requiring careful planning to tackle potential hurdles.
Explore our comprehensive FAQs below to understand better the process of selling a house without reaffirming a loan post-bankruptcy.
If you’re a homeowner in Southern California looking to sell your house after bankruptcy without reaffirming, reach out today to see how we can help
What Does It Mean to Reaffirm a Mortgage?
Reaffirming a mortgage in bankruptcy means agreeing to remain personally liable for the debt associated with the mortgage. You commit to keeping up with payments and protecting your property from being seized. This legal agreement allows you to maintain the same terms as pre-bankruptcy for the reaffirmed mortgage.
Additional reading: Can you sell a house with a mortgage
How Do I Know if I Reaffirmed My Mortgage?
Check your bankruptcy documents to confirm reaffirmation. Typically, a reaffirmed mortgage is formalized through a “Reaffirmation Agreement” jointly signed by you and your lender, sanctioned by the bankruptcy court. If you find this agreement while going through your records, it’s a good sign you reaffirmed your mortgage.
This is a good stage to check if there are any liens on your house if you aren’t sure. You’ll be surprised as to how many of the common property lien examples our customers have on their homes.
Additional reading: How do I know if there’s a lien on my house
What Happens if You Don’t Sign a Reaffirmation Agreement?
If you don’t sign a reaffirmation agreement, the lender might limit online account access, affecting convenience of seeing your remaining mortgage balance, for example. However, they typically continue accepting monthly payments. To ensure proper processing, include the loan number in the memo field of checks or money orders sent.
What Are the Consequences of Not Reaffirming the Mortgage?
If you don’t reaffirm the mortgage in bankruptcy, you’ll be free from personal liability afterward. But, the lender might not report your payments to credit bureaus, impacting your credit recovery. While it avoids foreclosure risks, it could limit credit improvement by not reporting your timely payments.
As you’d might expect, poor credit ratings show as if you haven’t made mortgage payments. And, naturally, this could lead to foreclosure, so you’d need to rebuild your credit rating.
But, you can still sell a house in foreclosure, so all is not lost. Check out our can you sell a house in foreclosure guide for more information on this.
Additional reading: How to avoid foreclosure
If I Did Not Reaffirm the Mortgage Can I Walk Away?
If you did not reaffirm mortgage after bankruptcy, you’re not legally obligated to continue payments. You have the choice to walk away from the property without personal liability for the mortgage debt. However, the lender still holds the right to foreclose and reclaim the property.
How Much Does It Cost to Reaffirm a Mortgage?
The cost to reaffirm a mortgage usually encompasses attorney fees, generally falling between $250 to $1,500. Additional expenses might arise from varying court filing fees depending on the location. It’s worth noting that in certain scenarios, lenders might take on these expenses as part of the bankruptcy procedure.
How Do I Reaffirm My Mortgage?
To understand how to reaffirm a mortgage, you must sign a ‘Reaffirmation Agreement’ with your lender, typically guided by your bankruptcy attorney. This agreement outlines your commitment to continue mortgage payments. Once signed, it requires court approval to become legally binding, ensuring clarity in the reaffirmation process.
Can You Reaffirm a Debt in Chapter 7?
In Chapter 7 bankruptcy proceedings, yes, you have the option to voluntarily reaffirm a debt, such as a mortgage. This involves a formal reaffirmation agreement, reflecting your dedication to repaying the debt. However, court approval is essential, ensuring it aligns with your interests and doesn’t create excessive financial burden post-bankruptcy.
Should I Reaffirm My Mortgage After Chapter 7?
Whether to reaffirm a mortgage after Chapter 7 depends on factors like your finances, property value, and ability to make payments. If you are uncertain, seek advice from a bankruptcy attorney. Reaffirming keeps the property but holds personal liability, while not reaffirming releases you from the debt after bankruptcy discharge.
Can I Sell My House After Chapter 7 Discharge?
Yes, it’s entirely possible to sell your house after obtaining a Chapter 7 discharge. However, take into account factors such as the discharged mortgage debt, potential creditor claims, and safeguarding equity. Seeking guidance from a bankruptcy attorney is advisable to expertly maneuver legal intricacies for a seamless post-discharge sale process.
How Soon After Chapter 7 Can I Sell My House?
You can sell your house immediately after Chapter 7 discharge. Bankruptcy laws mandate no specific waiting period. However, it’s essential to consider personal circumstances, the remaining mortgage, and any applicable legal requirements. Consulting a real estate agent and a bankruptcy attorney can offer valuable guidance.
However, keep in mind that a lien can survive after bankruptcy, so we recommend you check out our guide on how to get a lien off your house.
Can I Sell My House While in Chapter 7?
Yes, you can sell your house while in Chapter 7, but it’s vital to get court approval. Typically, the trustee oversees the sale process, adhering to state laws and property exemption standards. This way, everything stays legal and aligns with the property exemption criteria while selling during Chapter 7.
Again, when selling the property, we recommend you carefully check to see if there there are any liens on your house, still. Read up on this some more in our how to check for liens on a propertyguide.
Can You Sell Your House After Chapter 13 Discharge?
Yes, you’re free to sell your house after a Chapter 13 discharge. With the discharge, your assets regain your control. However, adhering to the court-approved repayment plan terms, including the reaffirmation of an agreement after discharge, is necessary if you intend to sell.
Consulting an experienced bankruptcy attorney ensures a seamless and legally compliant sales process, and most will offer a free consultation.
How Long After Chapter 13 Can I Sell My House?
After you’ve completed Chapter 13 bankruptcy, there’s no fixed time you have to wait to sell your property. Once you’ve finished paying off debts and your case is closed, you’re good to go. No need to delay; you’re free to sell your house whenever you’re ready.
If you’re in Southern California and need a quick sale, we’ll offer you a fair cash offer for your home. Contact our team today for more information.