Post Decree Mortgage in Foreclosure

[pablowhoever]

I tried searching for answers to this problem and was unable to find what I need. I was divorced in Apr 03. At the time the ex got one house and I got the other. She also got 1 lot at campground w/trailer and I got the other. Towards Aug of that year, she had been showing some responsibility in handling her debts and approached me about co-signing on a refinance of her home with cash back. I agreed with the stipulation that she buy me out of the other campground lot because I had no desire to go back there. She agreed. I also mainly did this because she lived close to me and it would allow the kids to more or less keep their regular lives moving forward. With the balance, she was supposed to pay off all her debts so she would just have 1 payment. Fast forward to Jan 06. We were no longer on friendly terms. She was playing games with the visitation with my daughters. In Feb I hired an attorney and took her back to court to modify the visitation. She waits a couple months then hires an attorney to increase the child support. By accident, I learn that she wasn't making the mortgage payment and that the finance company had initiated foreclosure proceedings. I had signed up with Truecredit to monitor my credit because I was trying clean up some other dings that I gained courtesy of my ex. By Sep 06 she files bankruptcy which I found out by talking with the attorney for finance company handling the foreclosure and was told that they couldn't give me any details. I contacted her BK attorney and was told that he couldn't give me any details. I contact the finance company and was told that they couldn't give me any details because it was tied up in ex's Chap 13. Now I was furious. I'm on the hook for hundreds of thousands of dollars and can't find anything out. Because of all the happenings, I ended up selling my house to my fiance because I was worried about having liens put on it. I now pay my fiance rent and cover the utilities as part of our agreement but still have a roof over my head. Shortly thereafter, I learned that the finance company backed out on the foreclosure and it was closed out. Later I learned it was because of the ex's Chap 13 repayment agreement. However, I still keep an eye on the credit report monthly and notice that the amount behind on the mortgage keeps climbing to the tune of the negotiated monthly payment each month. Now around rolls Dec 07 and I learn that her house is once again back in foreclosure. Not because I was ever served any paperwork which I wasn't for either foreclosure but because it showed up as forclosure proceedings on my credit report again. I begin to follow the proceedings on line at the circuit court clerk's website. I learned that in May 08, there had been a judgement of foreclosure. Now in Jul 08 I get in touch with the finance company. This time they said they would talk with me because it was no longer part of bankruptcy proceedings. I learn that after initial BK in Sep 06 only a few payments were made. I learn that as of Jul 07, no payments have been made. They refer me to the foreclosure atty. I spoke with that office and learned that a sherrif's sale was coming. I also learned that the mortgage was about $48,000 behind. Next thing was seeing the notice in our local paper advertising the sale and listing the parties as me, et al. Her name was nowhere to be seen. I contacted an attorney because other issues came up in regards to our domestic situation. He said that little can be done in regards to this foreclosure because it was post divorce so I am at the whim of the finance company and their attorney, and that I have to wait for the sale to go through and see what happens. So now I am patiently waiting for the sale. I am looking forward to the day when these 2 1/2 years of late payments destroying my credit report that I had no control over would soon be gone. I know it will take years but I saw the light at the end of the tunnel. Yesterday I call to confirm the sale (2 days away) and I find out that it's not going to happen!!! I learn that it is tied up in another bankruptcy as of 1 week ago and they can't discuss it. I learn the name of the BK attorney and once again am told he can't discuss the details. I was fit to be tied (pulling out my hair, screaming and yelling, some of the most colorful language that even I have ever heard). Now I am determined to find out the information. Through online searching, I learn that the BK would be part of public record and could be accessed through PACER so I sign up. I also contact my atorney and learn that by her filing bankruptcy, that would indeed stop the sale and that a repayment plan would be filed but that the finance company could reject it. He was unable to tell me what would become of this second foreclosure proceedings. So now I take a look at the documents filed. FYI a couple years ago she went on duty disability but that gives her a pretty good income. She declared that along with the child support payments. This really infuriated me. That is money that is supposed to be going to help support the kids, not to pay off her irresponsibility. She hasn't made a mortgage payment in over a year but has been telling the kids, "Oh I don't have any money for this or that, go ask your dad." And her repayment plan is rediculous. I know for a fact that it comes down to when not if there will be another foreclosure.

Now that I gave you a brief (LOL) introduction, here are my questions:
1. Because I am a coborrower, do I have any right to attend the 341 meeting?
2. Because I am a coborrower, if the finance company is able to continue the sale, and the house sells for a smaller amount than is owed, what are the chances that the mortgage company will seek a deficiency from me?
3. Along those lines, I know that they will sometimes walk away and write off the deficiency, but still issue a 1099. If I never put any money into it, will I have to declare that on my taxes? Her income (Duty disability, child support) is tax free and can't be garnished.
4. If the mortgage company seeks a deficency from me, because my payroll is easily accessed, what are the chances they will garnish my wages?
5. Also if there is a deficiency, do I have any recourse in filing a claim in her bankruptcy to cover the amount that will be taken from me?
6. Should I be considering bankruptcy and if so, at what point?
7. Is there anything else I need to be concerned about?

I know that I am looking for a lot of information but I appreciate any help I can get. Thanks

P.S. I live in Illinois

[BassBoy]

First, here's a link to Illinios foreclosure laws: http://www.foreclosurelaw.org/Illino...losure_Law.htm

Next, I'm sorry to hear of your troubles.

Let's see if I can answer a few of your questions:
For #1: You are not a creditor, so you may not be able to attend the 341.

For #2: You are responsible for and debt or unpaid balance when you are the co-signer.

For #3: If the deficency is forgiven, and because you are not the homeowner of record, I don't see how you can file for insolvency of the deficency. Based on this, http://www.foreclosurelaw.org/Illino...losure_Law.htm, there is no mention of co-signers. You may need to consult with an attorney.

For #4: If a judgement is granted against you, you could have your wages garnished.

For #5: Again, you are not a creditor.

For #6: A qualified attorney can help you. Consultation are usually free.

For #7: If you decide to file BK, getting educated is key.

[pablowhoever]

Thanks for responding to me. As far as the house, I am an owner. Even though the divorce granted her the house, my name was on the deed. She never got around to taking care of that. And with being a coborrower, there was no way I would have sign a quit claim deed. The mortgage foreclosure sale is listed under my name with an et al after it.
Thanks for the link. Loks like more research to do. Thanks

[spell]

P.S. I live in Illinois

I admit you lost me until this point.
I know these guys have helped out other IL posters: www.chicagobankruptcynetwork.com

The intersection between divorce and bankruptcy/debt is often confusing.
The best description I've seen is that they are two completely unrelated systems.
Depending on the details of an action, you can violate neither, one or both systems.

[pablowhoever]

Spell, thanks so much for the link. I have found some useful info there.