Expert: Mark J. Markus- California Bankruptcy Attorney - 5/2/2009

Question
Hello,my husband and i filed chapter 7 is was just discharged but not dismissed because of an inheritance the trustee is waiting for.  My husband and I signed a Debtors Statement of Intention  for the house notes and two cars; Also we did not sign any letters of reaffrimation on anything listed on the paperwork. MY first question are we responsible for the cars and the house or can we walk away without any ramifications?  My second question is that one of the cars was in a car accident and was totaled,  my insurance company sent me the checks for the car what do I do?  Thank You

Answer
As to your first question, yes you should be able to walk away without owing any further obligation on the house or vehicles because you did not enter into a reaffirmation agreement.

The answer to your second question depends on what the value of your vehicle is, whether there is any equity, and what exemptions you have available under your state's exemption laws.  If there is equity, then the insurance check would belong to the Trustee and you would need the Trustee's permission to negotiate it.

For more information on exemptions see http://www.bklaw.com/exemptions.html