Secured Debts

August 26th, 2009 by Questions

If I include my house in my bankruptcy and it produces a huge shortfall on the resale to pay off the mortgage, will I be
sued for the difference by the bank?

Posted from: Alberta


One Response to “Secured Debts”

, Barton Goth - Goth & Company Inc. -Trustee in Bankruptcy said:

In the absence of a bankruptcy you will be sued for the difference. However, if you file for bankruptcy and the foreclosure has taken place prior to the filing of the bankruptcy there is an immediate Stay of Proceedings that is put in place that removes the ability for the bank (or CMHC) to sue you as this is a debt that will be released by the filing of the bankruptcy.

The timing is essential, you want the foreclosure to have comensed prior to you filing for the bankruptcy, if it has then it is probably best for you to contact a local trustee directly..

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