If we are buying a house in my wife’s name and our current house in my name is being foreclosed on and I’m facing bankruptcy, how do we protect the new house?

Get Legal Help Today

 Secured with SHA-256 Encryption

If we are buying a house in my wife’s name and our current house in my name is being foreclosed on and I’m facing bankruptcy, how do we protect the new house?

My home in IN is foreclosing. My wife and I live in DE. We are buying a house under her name only. What do we need to do to protect her? The IN home is strictly under my name and bought before our marriage. I (only) maybe also be forced to file bankruptcy. We need to know what to do to protect her and the new house from any “fall-out” from the foreclosure and bankruptcy.

Asked on September 8, 2011 under Real Estate Law, Delaware

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

If the home that is being lost in a foreclosure is solely in your name as well as the loan for it that is distressed and your wife is buying a home in her name only, your loss of the Indiana home should not affect her ability to get a loan for the one she is buying in her name.

One issue is whether or not the loan for the home being lost in Indiana is "purchase money" or not. Meaning, is the loan for the Indiana home the original loan for the property and was the home used for your personal residence? If so, and if Indiana has anti-deficiency legislation on "purchase money" loans, the lending institution cannot go after you personally for any deficiency on the sale.

One means for protecting your wife's assets regarding any foreclosure or bankruptcy by you is to have a trust created for her where she transfers title to all her assets to it. She should consult with a qualified wills and trust attorney for this.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption