Concerning Tendants of Interity in Chapter 7

[dave1946]

What is the name of your state?What is the name of your state? Michigan

Our home's deed is in both husband and wife's names. But our morgage company only required my husband to sign for the loan. Michigan law would not allow the morgage company to file a morgage.

Only my husband has filed Chapter 7. So now what happens with the property since there is not a real morgage? We have checked several times with the Register of Deeds and no mortgage has been recorded in the past 5 years since my husband obtained the loan without my signature.

Can the bankrupcy trustee allow the morgage company to take the home? Or what can happen to the loan since I was never asked to sign? Currently the Trustee doesn't want to exempt the property. What could happen now?

[Ladynred]

Talk about an archaic law !! Can't file a mortgage lien because BOTH of you didn't sign ?? Geez.. MI needs to come out of the dark ages.

Anyway, without a recorded mortgage lien, there is nothing to encumber the equity value in the home. That means, as far as the Trustee is concerned, you have 100% equity in your home and that means $$$ for him to get at by taking your home and selling it to pay your creditors. The exemption DOES apply, but you won't be able to protect the full value of the property. If you used Federal exemptions, that means the exemption total is about $37,000. If the Trustee takes your house to sell, he WOULD have to pay YOU that $37K exemption amount.

Normally, with a recorded mortgage lien, you would subtract the amount you owe on the mortgage from the value of the home and what's left is the equity you can apply the exemption to.

Without a LIEN against the property, the mortgage company CAN'T take the house because the loan is NOT SECURED by the home. No LIEN = NOT SECURED.