Legal Question in Bankruptcy in South Carolina

Possible Forced Bankruptcy?

Hi, and thanks for reading my question. I'm currently considering letting my house go to foreclosure, voluntarily, because it's become infested with mold, both inside the home and in the crawlspace. I understand that defaulting on any loan is never a good thing, but I can't afford to remediate the problem any time soon. My question is, how likely is it that the mortgage lender will seek to file an involuntary bankruptcy petition against me to recover the outstanding debt once the property is auctioned off? My current loan balance is 57K, but the house would only bring 25-30K at auction, as it's half-renovated and in a state of general disrepair. I sincerely appreciate your advice.

Thanks,

Josh


Asked on 5/14/07, 9:45 pm

1 Answer from Attorneys
Sheryl Schelin Law Office of Sheryl Schelin

Re: Possible Forced Bankruptcy?

The creditor wouldn't need to force a bankruptcy on you in order to get a deficiency judgment. That would happen in foreclosure proceedings, and would generally be valid for 10 years, unless renewed. So if you obtained any other property in that time, the judgment for the deficiency would act as a lien against that property.

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Answered on 5/29/07, 9:18 am


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