Call Now!
Call Us 414-326-9231 608-260-7133 Text Us 414-326-4709

Divorce, bankruptcy and mortgages

Some Wisconsin readers may have questions about how their mortgage or bankruptcy proceedings are affected by divorce. One man got divorced in 2009 and had his name removed from the deed and had it put in his ex-wife's name. After signing over the deed, he filed for Chapter 7 bankruptcy, which was discharged in March 2012.

Although this was done after the house had been put in his ex-wife's name, the mortgage remained in the man's name and was part of the bankruptcy. There is equity in the home and the payments are current. There remains the question of if he should keep the loan the way that it is or get it reaffirmed.

In this case, it was advised for the man to leave the situation as-is. Reaffirming the loan would re-establish the man's liability that he was able to eliminate through the bankruptcy. As a result of the bankruptcy, he is no longer liable for the mortgage even though his name remains on the loan. The current arrangement would make the man's ex-wife liable for the loan because she did not file for bankruptcy. As long as the payments are kept current, the house cannot go into foreclosure.

Divorce can become complex when there are additional factors involved such as bankruptcy proceedings and mortgage loans. Individuals who are contemplating divorce, especially those with a complicated financial profile, may choose to contact a Wisconsin divorce attorney. Prior to filing for divorce, an attorney may be able to answer questions and help formulate a strategy. In addition, an attorney may be able to help parties to negotiate a divorce agreement that is satisfactory to everyone involved.

Source: Fox Business, "How Does Divorce Affect Bankruptcy and Mortgage?", Justin Harelik, July 03, 2013

No Comments

Leave a comment
Comment Information
Email Us For A Response

Free Case Evaluation

* indicates required field

Miller & Miller Law, LLC
  • VISA
  • Master Cards
  • Discover
Milwaukee Office map Madison Office map Kenosha Office map

633 W Wisconsin Ave, Suite 500
Milwaukee, WI 53203

Phone: 414-312-6581
Fax: 414-277-1303
Milwaukee Office

2810 Crossroads Drive
Suite 4001
Madison, WI 53718

Phone: 608-260-7133
Madison Office

6123 Green Bay Road
Suite 210
Kenosha, WI 53142

Phone: 262-326-1669
Kenosha Office

Appleton Office
4321 W. College Ave.
Suite 200
Appleton, WI 54914

Phone: 920-280-3838
Appleton Office

Brookfield Office
200 S. Executive Drive
Suite 101
Brookfield, WI 53005

Phone: 262-261-0665
Brookfield Office

Glendale Office
6333 N. Green Bay Avenue
Glendale, WI 53209

Phone: 414-973-8662
Glendale Office

Fax: 414-277-1303 - We also have offices in Appleton, Glendale and Brookfield to better serve you.