Insurance Question

[ezgo68]

We filed BK in April and were discharged in July. Our attorney said since we didn't re-afirm the mortgage we could just "walk away" from it. That is what we are going to do. We will be moving out in a couple of weeks.

1. Do we just turn the utilities off and forget about it?

2. What about insurance? Our insurance payment was included in the mortgage.

3. Do we need to call the lender and let them know we are moving?

[HHM]

"Walk-away" is not meant to be taken literally.

Basically you have a couple options.

1. If you really want to move ASAP, call the bank and tell them you want to do a Deed in lieu of foreclosure. Which basically means, you sign over your interest in the house to the bank...the benefit to the bank is they don't have to go through the foreclosure process. However, the bank does not have to accept a DIL, so then you are left with option 2.

2. If you want to live rent free for 4-8 months. Simply stop making your mortgage payment, and the bank will eventually initiate a foreclosure, and depending on what state your are in, foreclosure can take anywhere from 4-12 months to complete. And guess what, during that time, you get to live in the house without paying your mortgage, (imagine the money you will save).

About insurance: Strictly speaking, you are required to maintain insurance on the home.

[ezgo68]

I asked my attorney what we need to do. We are moving this weekend. He said he would send a letter to the mortgage company telling them we were surrendering the house and would turn off all utilities and stop insurance on Sept. 15.

He sent the letter a couple of weeks ago but we haven't heard anything back.

[demismom]

I was told that we needed to keep insurance and upkeep on the house until it was no longer in our name. Our house is in foreclosure now and the sale is on September 20th.