Wanna Keep the House? Then Pay the Mortgage! Ditto Your Car!

Generally, people understand that banks are smart, or at least have good lobbyists. And it makes me sad when people believe what they want to believe: that they can keep collateral without paying for it. Now, there are a very few cases where, for instance, the second mortgage is completely underwater, and there's no equity in the house above the first mortgage amount, where a second mortgage won't immediately start a trustee's sale, because even if they scrape the debtors off title, the second mortgage will still be taking subject to the first mortgage. And sometimes, the second mortgage might even be willing to sell a lien release to a debtor. But if the second mortgage is completely or partially secured, and the debtor isn't making payments, the second mortgage holder will eventually get around to filing a trustee's sale, and 90 days thereafter (in Arizona), the debtors will no longer have an interest in the property. Lately I've talked a lot about reaffirmations, the most confusing area of the law at this point; apparently every single Arizona Bankruptcy Judge has a slightly different procedural approach. I'll detail them all, every single one, soon. At least a couple have forms that they want a debtor to sign, in connection with reaffirmations, before they'll set a reaffirmation hearing, and I'll post those forms soon. Remember, the Holy Grail of Reaffirmations is not a reaffirmation agreement signed by a Bankruptcy Judge: it's an In re Mustafi Order! The optimal result is that the Bankruptcy Judge deny the reaffirmation request, or vacate the reaffirmation hearing, and enter an order pursuant to In re Mustafi. One of the Judges even enters a Mustafi-PLUS order, but that's another article for another day. NOTHING IN THIS BANKRUPTCY BLOG CONSTITUTES LEGAL ADVICE RE A CHAPTER 7, CHAPTER 13, CHAPTER 11, OR CHAPTER 12. FIND AN ARIZONA BANKRUPTCY ATTORNEY WHO IS BOARD CERTIFIED IN BANKRUPTCY LAW, AV RATED, AVVO 10, ON SUPERLAWYERS, OR JUST VERY EXPERIENCED AND A FORMER CHAIR OF SOME BANKRUPTCY THINGIE. NOTHING HERE MAY BE USED AS LEGAL ADVICE IN CONNECTION WITH ANY BANKRUPTCY, WHETHER THAT BANKRUPTCY IS IN PHOENIX, GLENDALE, TEMPE, MESA, SCOTTSDALE, GILBERT, CASA GRANDE, OR ANYWHERE ELSE IN ARIZONA!

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