Geneseo, NY Bankruptcy Law Firms & Lawyers

You are free to own property right after you file your Chapter 7 case. If you are going to buy real estate, it usually takes about 2 years after your discharge before you will become eligible for a mortgage.

Sounds like you are worrying for no reason. As long as you are living in the property, now might be a good time to apply for a mortgage modification to reduce your interest rate and payment amount. If down the road you decide you don't want it anymore, you could sell it & if you have to short sale, there will not be any tax consequences to you.

It would be helpful to know more information such as whether you live there, whether the other cosigner intends to continue paying on the house, whether you are paying on the house, whether there is equity in the house and what state you live in. If you are paying on the house now, there is little to no impact. The other cosigner simply will not be responsible for it going forward. If they are paying the loan, all is well for now, but they may be able discharge their liability on the debt either with a plan amendment or conversion to Chapter 7 (By the way, I'm guessing the cosigner filed a 7 or 13 because 11's are rare for individuals, but it's possible). In the case of a Bankruptcy discharge or the case that they are not paying it to begin with, you remain responsible for the loan. From that point the question is whether you want to save the house for equity's sake or credit's sake or have no choice but to walk away. In some states the mortgage company can really only get the house back and can't come after you for personal recovery. In other states, like Kansas, personal recovery ("in personam") can be requested, but is rarely pursued in my experience, at least on the consumer side (i.e. non-commercial).