Expert: Mark J. Markus- California Bankruptcy Attorney - 2/2/2010

Question
QUESTION: If i file bankruptcy and have very low income but am caught up on the mortgage ($746/month), will I be able to keep the house if I reaffirm the lender?

ANSWER: reaffirmation on real property debts is not required.  If you stay current with the payments, the mortgage lender cannot foreclose unless your state has some law allowing them to.  The only other way you could lose the house is if there is equity in the house beyond the exemptions you are allowed in your jurisdiction.

To see more on exemptions please visit http://www.bklaw.com/exemptions.html

---------- FOLLOW-UP ----------

QUESTION: Thanks.  Just wasnt sure if judge would rule I couldnt afford the house even though I will stay caught up and my roomate pays half the mortgage also.  Also wanted to ask since we just got divorced, can I still file ch7 and have credit card debt discharged despite new laws?  Divorce decree states I pay some of the credit cards and my ex wife pays the rest, but she is actually in agreement to also file bankruptcy since we cannot make ends meet with all the joint credit card debt.  Will that go through ok?

Answer
The divorce decree doesn't change your obligation to the creditors.  What it does is create a debt you owe to your ex-wife.  That debt may or may not be dischargeable depending on whether it's in the nature of alimony/support or something else, and what chapter of bankruptcy you file.  In a Chapter 7, it would not be dischargeable.  The debt you owe to the credit cards would presumably be dischargeable, absent any fraud or other stated basis for objection.