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| Author: |
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Francis |
| Date: |
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January 5, 2004 |
| Question: |
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I bought a house with a friend. The mortgage is about $160000 and the value of the home is about $225000. Unfortunately my friend is getting deeper and deeper into debt. He has more than $75000 home equity line of credit debt. The home equity line of credit came from a condo he owns with his mom and not with this house. Plus, he has several thousand dollars in unsecured debt. I find myself in a big jam, because he is unwilling to sell the house so we can pay back the mortgage to the bank and he is unable to pay for the mortgage anymore. He if declares bankruptcy, how does this affect the home that we jointly own? What happens to his secured home equity line of credit (condo)? How will it affect me if he declared bankruptcy? I need to find a way to get my name off this mortgage. Thanks.
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From: |
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Ann Clarke, Alger & Associates Inc. |
| Date: |
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January 6, 2005 |
| Answer: |
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If your friend files for bankruptcy you will still be entitled to your half of any equity in the property. If he refuses to pay the mortgage and you also stop paying, the mortgage company will start foreclosure action to recover their debt. I'd suggest you contact a lawyer about your legal rights in this situation.
Ann Clarke
phone: (403) 296-2972
aclarke@moneyhelp.ca
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