Mortgage question for wife not filing BK

[BKMarty]

Hi Iam new to the site greatly appreciate any good advice.
I will be filing for chapter 7 BK in 3 weeks. I currently own 8 properties which are all going to be included in the BK. My wife will not be filing for BK but her name is on 3 of the mortgages (none of them being our primary). After I file for the BK all these mortgages will show up on my credit report as BK but what would happen to my wife's credit report I have not payed any of these late. Would these properties now be owned by my wife and the bank? Would the bank be willing to remove my wife from the note to sell the property there might be a little equity in them. Or will my wife be solely responsible for these properties now. I really want to save my wifes credit. Also on my primary home I owe $650K on the 1st and $287K on the 2nd. The home has lost major equity in the last 2yrs and is now only worth about 800K meaning I owe $137K more than what its worth if the 2 banks are being included in the BK but I wish to stay in the home (have not been late on these mortgages)can the $137K be written off in the 2nd mortgage in the BK. Thank you for your help.

[BKParalegal]

In regards to your primary, you cannot strip off a second loan in Chapter 7, that can only be done in a 13. Your wife will still be liable for the 3 properties that her name is on, and if some of those properties have equity, and if your state does not have a wildcard exemption to protect it, the trustee can sieze the asset and sell it themselves. (even the ones with your non-filing spouse, she would get 1/2 the profits though)

Good Luck

[BKMarty]

Thanks for your info. Do you know if Florida has a wildcard exemption? The equity in these homes is very minimal just a few thousand maybe not even that these days. If there is not enough equity to make it worth while for the trustee would the properties go back to the bank with the lien or would they keep the title in my wifes name?

[justbroke]

Thanks for your info. Do you know if Florida has a wildcard exemption? The equity in these homes is very minimal just a few thousand maybe not even that these days. If there is not enough equity to make it worth while for the trustee would the properties go back to the bank with the lien or would they keep the title in my wifes name?

Florida has a Homestead Exemption. You can't use that on invesment property or non-homestead property. I believe you can only have one homestead under Florida law.

For Florida, the so-called wild card Exemption is only $1,000.

The Trustee may not want the assets if there is not enough equity to have it sold and earn some money from it. That's up to the Trustee to decide, but think of it this way. If the property is worth $101K and the amount owing is $100K, just the sheer cost of trying to get the $1K (equity) would exceed the Trustee's costs. The trustee would, more than likely in that case, "Abandon" the property and allow the Bank to pursue a Relief from Stay and then a foreclosure.

The lien always survives the Bankruptcy, so the lien would still be held by the Bank. I'm not sure how it would work out for your wife.

Totally guessing, since you're current on all 8, the Bank may be okay and not even take any action.

Since you're also current on your primary residence (homestead), you will probably have to re-affirm the note with the Bank. However, I'm no expert in this area...

Your situation is not unique, but it's than most.

[sandybraun]

Since you're also current on your primary residence (homestead), you will probably have to re-affirm the note with the Bank.

It is the truth. There was such situation with me. I have felt it on myself. Itself has tried