I have a rental (and also a house I occupy). With sales expenses, prepayment penalties, and etc it would not be able to be sold to satisfy the mortgages (first and second) due to value decline in the crashed market. One lawyer told me that the trustee may just ask me if I want to continue making the payments (none are delinquent, and there is a tenant in place), since the trustee would not be able to sell it and make money to pay creditors. Has anyone else been in this situation, to possibly have non-exempt real estate abandoned back the the debtor? I am interested since the tenant is a friend of mine, and it would ease my mind knowing there's a chance he may not be evicted by the lender. Also- I have ben told many different things about a tenant- that his lease remains valid and the lender has to honor it, that the tenant will automatically be given an eviction notice, etc. I have yet to see any information online aabout a debtor that also owns rental property. I plan on CH7 when appropriate, since I lost my job, and lose money every month on the rental, etc.
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The main question is, do you want to keep the property or not?
If you do want to keep it, and there really is no value in it, then the BK trustee will probably leave it alone. The trustee will probably not officially abandon the property (i.e. by filing a notice of abandonment), but simply let your case go to discharge without requesting turn over the property.
As for the lender, if you want to keep it, you MUST keep making the payments, otherwise, the lender can foreclose. If the lender forecloses, the tenant is usually given a 30 day notice of eviction.
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