Legal Question in Bankruptcy in Illinois

This may be better posted as a family law question. Either way, I am not sure that everything can be covered sufficiently on a site like this.

If you sell and pay off the loan, then your fiance's name and his ex's name would be, so to speak, "off the loan." That would avoid the damage of a bankruptcy and/or foreclosure on your fiance's credit and probably would make things better as far as being able to move (assuming that you are buying elsewhere or that a landlord will do credit checks), purchase vehicles in the future, etc.

You do not mention what the divorce provided concerning the property, whether there has been a quit claim deed, whether she would expect proceeds to be divided (if any), whether she would cooperate to avoid additional liabilities (although her mortgage obligation has likely been discharged, she probably is on the hook for post-bankruptcy association fees and assessments or other liabilities (like injury claims) and she runs those risks so long as she remains on title).

If your fiance has other debt, then bankruptcy may be a consideration. Note, however, as suggested above, the association fees would remain an issue both for him and the ex until the property title changes (usually many months down the road after foreclosure sale).

If she does not want to cooperate, you would have to evaluate whether it is worth returning to family court to resolve the matter. It may be, depending on whether he has reason to file bankruptcy.

As far as taxes, you should speak with an accountant or experienced tax adviser, but I do not see how she can claim expenses that she did not pay.

If bankruptcy is a consideration, the scope of this space does not afford an opportunity to assess the situation and advise you. I recommend you assemble for legal consultation: (1) income information for August 2013 through the present, including wages and unemployment during that period; (2) all bills (copies neatly assembled, back pages included); (3) last two years� tax returns; (4) a credit report (use www.annualcreditreport.com to obtain free report if not requested in last year); and (5) other information that may apply, such as copies of lawsuits. Call at your earliest convenience to afford the most opportunity in which to be advised about the best course. You are not required to use an attorney in your area.

I do not recommend anyone filing bankruptcy on their own. There are too many complex issues. I have seen several posts on this site for debtors who filed on their own and are seeking counsel concerning complications. Most of them will have a hard time finding an attorney to get involved to unwind the mess without the attorney charging several times what would originally have been paid.

You are putting the cart before the horse. The ex-wife being on the mortgage has nothing to do with his ability to sell the property provided that she is no longer on the title. A mortgage is merely an agreement between a title holder and a lender. Liability for an outstanding mortgage cannot be determined by a divorce court. If your fiancee was awarded the condo in the divorce then he is liable for payment of the outstanding mortgage, any taxes, assessments and insurance. If, however, the parties retained a joint interest in the property pending a future sale and division of any equity, you may have a different problem as your financee may owe his ex a portion of the proceeds. If this is the case then you may need to negotiate with her a reduction to that amount based on the outstanding expenses and the language of their Judgment.

The place to start is with their Judgment. He may want to contact his divorce attorney for advice before doing anything else. You should also be aware that if he files for divorce his ex may become a creditor and he may not be able to discharge her interest in any equity produced from a sale of the property. You may also not be able to sell the property because it will become part of the bankruptcy estate and will be controlled by the BK court and the Trustee.