Q: A home mortgage was discharged under a previous bankruptcy. Is a mortgage still discharged after a refinance?
The home is on my name alone. I refinanced later. The new note has my wife and me as borrower, and owners!? can she file bankruptcy without loosing home in Florida?
A: When you refinanced the home, the new loan replaced the old one (probably paid it off), so the discharged amount is gone forever. If you and your wife are both borrowers on the new loan, and you are both on title as owners, then the same rules will apply to the new loan if she files bankruptcy. She will be entitled to exempt her equity in the house (whatever that amount is under Florida law). Whether she can exempt your equity too is a Florida law question. Not sure why she would be filing alone, so I'm not sure I've answered your question. Hopefully there is a Florida attorney out there who can give you a better answer.
Timothy Denison agrees with this answer
In a Ch. 7 bankruptcy, no lien is discharged (thanks to a US Supreme Court opinion in the Dewsnup case, despite Bankruptcy Code language to the contrary).
What is discharged, however, is an unsecured deficiency amount in the Mortgage indebtedness.
Some liens can be converted to unsecured claims in a Ch. 13, if conditions are met, but not a primary first residential lien on the residence.
Generally speaking, a refinance of a residential mortgage does NOT change existing ownership of the property. A non-owning (according to current deed) spouse can certainly be a named mortgage borrower without being named as an owner on the current deed. A cautious mortgage lender would add spouse's obligation on a refi, and probably even require that the spouse be added to title by executing a new deed.
Beyond that, FL law of real property pertains, and as my colleague recommends, you should confer with an experienced FL lawyer about your issues. The smart client obtains answers about applicable law BEFORE taking actions.
Timothy Denison agrees with this answer
A: If a mortgage was discharged in a previous bankruptcy and the home was later refinanced, the new mortgage is not covered by the previous discharge; it is a new loan with its own terms. If only one spouse's name was on the original discharged mortgage and both spouses took on the new loan, both are now responsible for the debt. In Florida, if your wife files for bankruptcy, the ability to retain the home will depend on several factors, including whether the equity in the home is exempt under Florida’s homestead exemption and whether she can continue making the mortgage payments. It's crucial to review the terms of the refinancing agreement and consider Florida's specific exemption laws and how they apply to your situation.
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