Debra Booher &Associates Co., Lpa Click here to get your free Legal evaluation
Call Us Today Toll Free
888-542-1300

What happens when your ex files bankruptcy and you co-own a home?

When you co-sign a home with someone, one of you will always remain on the hook for the debt if the other defaults. This is true regardless of your relationship with the person. That means if you and your former spouse co-own a home together in Ohio, and he or she files for bankruptcy, you will likely have to bear the burden of the mortgage on your own if you hope to keep the home. That said, depending on the type of bankruptcy for which your former spouse filed, the situation may be a little more complex than that. SFGate explores your options for bankruptcy after divorce.

If your co-owned home is in Chapter 7, the bankruptcy will wipe out your ex's financial obligation for the mortgage on the property. However, because you did not file for bankruptcy, the lender can turn to you for repayment. If you do not meet your own and your ex's former payment requirements, the bank can foreclose on the home. If, for some reason, your former spouse still lives in the home and he or she filed for bankruptcy regardless, the lender can still look to you for payment of the loan.

Furthermore, if your shared home is in Chapter 7, and if your ex is on both the deed as a co-owner and on the mortgage, the lender may look to his or her share of the home for equity. If this is the case, your only saving grace would be if the value of your ex's share of the equity in the home is less than Ohio's homestead exemption.  

If your co-owned home is in Chapter 13, the situation is slightly different and the outlook much more promising. Under a Chapter 13, your ex is still responsible for remaining current with his or her regular monthly bills. Though the bankruptcy courts prioritize debts in a Chapter 13 case, because a house is such a huge asset, and because homeownership is often only possible via a large loan, a home loan is likely to top the list for repayment. Unless your spouse owns several significant assets, it is safe to assume that he or she must continue to contribute to your mortgage payment each month under a Chapter 13.

The information in this post is for educational purposes only. It should not be interpreted as legal advice.

 

No Comments

Leave a comment
Comment Information
Email Us For A Response

How Can We Help?

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

Cuyahoga Falls Office
1350 Portage Trail
Cuyahoga Falls, OH 44223

Cuyahoga Falls Law Office Map

Beachwood Office
3401 Enterprise Pkwy.
Suite 340
Beachwood, Ohio 44122

Map & Directions

Independence Office
4700 Rockside Rd
Suite 415
Independence, Ohio 44131

Map & Directions

Westlake Office
1991 Crocker Rd
Suite 600
Westlake, Ohio 44145

Map & Directions

Canton Office
4450 Belden Village Street NW
Suite 204
Canton, Ohio 44718

Map & Directions

Ravenna Office
2633 St. Rt. 59
(Orchard Plaza)
1st floor
Ravenna, Ohio 44266

Map & Directions