Can my mother apply for Chapter 7 bankruptcy or should she let the bank foreclose on the house and walk away if she is 78 years old?

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

Can my mother apply for Chapter 7 bankruptcy or should she let the bank foreclose on the house and walk away if she is 78 years old?

My mother has health issues and she needs to live where she will receive assisted living or may move in with me. Due to the housing market, she now owes more on her house than its’ value. I have paid her utilities for the past 2 yrs because her SS covers her house payment, escrow, supplemental insurance premiums and creditor payment on an old credit card only.

Asked on October 25, 2012 under Bankruptcy Law, Illinois

Answers:

Terence Fenelon / Law Offices of Terence Fenelon

Answered 11 years ago | Contributor

Since there is little or no equity in the house, I would first approach the lender with an offer of a deed in lieu of foreclosure.  Such an option is advantagous to both parties.  The lender obtains quick possession of the property withourt the incurrence of thousands of dollars of fees and costs and your mother would receive a foregiveness of any remaining debt, thus relieving her of bankruptcy filing fees and attorneys fees.  Some lenders even offer a cash relocation fee to to expedite the process.


If she were to file bankruptcy, she would probably remain in the residence for a longer period of time but the utilities would still have to be paid and the house maintained.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption