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Ellen, Attorney
Category: Bankruptcy Law
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Experience:  Bankruptcy Lawyer. Experienced.
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My ex-husband & I still own a home together which I have sole

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My ex-husband & I still own a home together which I have sole use & occupancy of until 4/2010. When we divorced, did we go from tenants by the entireties to tenants in common? The loan is not in my name. I did not sign any loan documents, except the deed of trust. I am struggling to make payments and am gettng behind. The loan is far more than it's value, making it difficult to sell. I am considering bankruptcy as I was also left with 50K in charge card debt. I am a single mom struggling to make ends meet. How does our tenancy affect my liabilty for the mortgage? If I file bankruptcy, should I reaffirm the debt (if I am responsible for it) on the house? The loan does not show up on my credit report. Thank you very much for your help!
Submitted: 7 years ago.
Category: Bankruptcy Law
Expert:  Ellen replied 7 years ago.

A divorce does change ownership of a property from tenancy by the entireties to tenants in common. It does not change your liability to the lender. If you were not personally obligated to the lender prior to the divorce, the divorce does not create a liability to the lender.

That said, you may be liable to your ex for the mortgage pursuant to your divorce decree. Your liability to your ex would not be dischargable in a bankruptcy. This means that any debt that your ex was liable for that was awarded to you in the divorce is nondischargable as to your ex in a bankruptcy.
Customer: replied 7 years ago.
Thank you for your reply Am I "liable" for the debt since I did not sign any loan papers or the note? The only thing I was told to sign was the Deed of Trust. When I contacted the mortgage company to ask about the staus of teh loan, I was told they could not talk to me as my name did not appear on the loan. I am trying to figure out what signing the Deed of Trust obligated me to. When we divorced, the debt was not transfered to me, I just was told to make the payments, and I am trying to understand what happens if I am no longer able to do so.....thanks for your help!
Expert:  Ellen replied 7 years ago.

The deed of trust would not typically obligate you to pay the debt. The purpose of the deed of trust is to secure the promise to pay of the Note. I find it unusual that your property settlement agreement would not state that you are responsible to pay the mortgage payments if that was your agreement. You will want to verify this obligation is not in your PSA prior to stopping the payments as the debt under the PSA will not be dischargable in a bankruptcy.
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