Should I file a bankruptcy if I live in Bergen County and have no creditors other than my 1st mortgage which is in foreclosure?

If you have no unsecured debt and own a home in foreclosure you may be wondering whether you should file a bankruptcy.  Filing bankruptcy is a personal decision.  If your only reoccurring monthly debt is your mortgage (which is in foreclosure) you may decide to file a bankruptcy so that you can zero out the mortgage debt on your credit report.  Filing bankruptcy when you credit score has already taken a hit for something like a foreclosure can often result in an almost immediate increase in your credit score.  In New Jersey, it is extremely unlikely that you will be sued for a monetary judgment by your mortgage company for a 1st mortgage on a primary residence.  The standard practice is for the mortgage company to take back the property in a foreclosure but the mortgage balance remains on your credit report.   FYI – A 2nd mortgage will almost always sue you for a money judgment after the 1st mortgage takes your property back through foreclosure.

Remember bankruptcy is a personal decision.  No two bankruptcy cases are alike.  Foreclosure is not the end of the world (even if it feels like it) and bankruptcy is not necessarily a bad thing (again even if it feels like it).  Speak to an attorney to discuss the specifics of your case and explore your options.

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