If I co-own my home with a family member, will my bankruptcy effect my co-owner’s credit or co-ownership of the property?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
If I co-own my home with a family member, will my bankruptcy effect my co-owner’s credit or co-ownership of the property?
I recently went on Social Security Disability, which is my only income. I have substantial credit debt, about $ 20,000. My co-owner has perfect credit, owns his home, 2 cars and has no debt. We own a $ 300,000 home with very little equity, around $30,000. Will it effect my ownership? Is it possible to transfer the entire property to my co-owner prior to bankruptcy, or is it breaking any laws to do so? Prior to my unemployment I had good credit as well.
Asked on October 10, 2012 under Bankruptcy Law, Maryland
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Under federal bankruptcy laws as well as laws with respect to the states in this country with respect to debt issues, your credit issues will have no effect upon your co-owner's credit concerning the real property you both own so long as the debt load on it is serviced timely.
I would not unilaterally transfer your interest in the property you are writing about to the co-owner before the bankruptcy filing for no consideration. If you wish to sell the interest, then a formal escrow with purchase contract and disclosures can be done before any bankruptcy filing so that the sale is deemed an arms length transaction under the law.
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.