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Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2830
Experience:  Better Business Bureau. 18yrs bankruptcy experience. Chicago Bar Assoc. American Bankruptcy Institute member.
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I resided in Arizona and filed chapter 7 bankruptcy in May

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I resided in Arizona and filed chapter 7 bankruptcy in May 2009 because I lost my job and had no income. I owned a home which was in an HOA. I had not paid my mortgage for several months and the lender filed its intent for a Trustee's sale. The lender postponed the foreclosure because of the bankruptcy. I was granted a discharge in November 2009, which included a discharge of the mortgage debt on the property and the delinquent HOA fees pre-petition. Following the discharge, I contacted the lender and told them that since I no longer had a debt to the property I had already vacated the property and wanted to transfer title to the lender so they could proceed with the Trustee's sale. I asked the person I spoke with if I could file a quit-claim deed and she said yes. I did that in August 2010, recorded the deed with the County recorder in AZ and sent the copy to the lender. Over the course of the past 3 years, the bank has scheduled and then postponed Trustee's sales, and several months ago, they sold the loans to a new lender. Now, it appears that the new lender has scheduled a Trustee's sale, and the HOA is coming after me for about $7K of HOA fees that are still accruing through July of 2013, and they want me to pay this prior to the sale, even though the County Assessor clearly shows that the previous lender has title to the property, and has, in fact, been paying all of the taxes, insurance, etc. This lender dragged its feet and did nothing to try to sell the property once the bankruptcy was discharged. Any suggestions?

Terry L. :

Hi, thanks for your question. You should hire a lawyer for specific legal advice. No attorney client relationship is created here..

Terry L. :

While you cannot force a lender to foreclose, you can definitely keep on them to do so.

Terry L. :

You indicated you filed a quit claim deed? Did both parties sign this?

Terry L. :

If all parties signed it and the deed is recorded properly, then you are off of the hook from that point forward for the HOA.

Terry L. :

Future HOA dues are not dischargeable in your bankruptcy case, so you are liable from the bankruptcy date until a valid quit claim/deed in lieu of foreclosure, or actual foreclosure.

Terry L. :

You should contact the HOA, show them the valid recorded quit claim deed, and direct them to the lender to collect any post transfer assessments that have come due.

Terry L. :

If the quit claim wasn't done properly, then you could still be on the hook for all those assessments afterwards, since it is still your property.

Terry L. :

Have a real estate attorney review the matter and they can give you proper advice regarding the deed etc.

Terry L. :

Let me know if you have any questions. thanks

Terry L. :

Terry

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