Legal Question in Bankruptcy in Minnesota

Re: bankruptcy

Assuming that you are talking about a Chapter 7 Bankruptcy, which is what most of them are, upon the filing of the petition all of the debtor's property becomes property of the bankrupt estate, which is controlled by a trustee. This includes your co-owner's half of the house.

However, your half of the house is untouched. You own the same half of the house both before and after the bankruptcy. From your perspective, nothing changes.

If your co-owner is living in the place, I would expect this person to claim the house as an exempt homestead, in which case the Trustee will eventually have to release it back to your co-owner. Another circumstance may be that the Trustee will give up his or her interest in the place because there's no equity or not enough equity to bother with.

If the Trustee gives up on the place one way or another, then it belongs to your co-owner again as if not much happened. I would say that this is the outcome in the majority of cases, although I don't have enough info to predict much for your case.

Worst case would be that you wind up with a bankruptcy trustee owning your co-owner's half of the house and the trustee selling that half to someone you don't enen know.

As to how it will affect your credit: it's not supposed to affect your credit at all. You're not filing a bankruptcy. If you get into some difficult dealings with a Trustee, I suppose some of that could affect your credit indirectly.

It would be a good idea for you to do a face to face consult with your own lawyer. This response is intended for general information purposes only and is not legal advice. It does not create an attorney-client relationship.