loan

[sabina]

I took a second mortgage and used it to buy a business. After three years, we are about to close the door. We will file bankruptcy on business, so my question is, because we can prove that money from mortgage went to business, can we claim it in bancruptcy w/o lien as long as property is in our hands? Can that be deducted as business loss/ bancruptcy?
Thank you

 

[presutin]

I strongly suggest that you find an experienced bankruptcy attorney to handle this situation since these items are state specific. Good luck to you!

 

[dee_dub]

Assuming you took the loan out in your own name, the bankruptcy of the business will have no effect on your own personal liability to pay back the loan. It's not a debt of the business, it's a personal debt.

On the facts you've set out, there's no issue of a lien on the property. The problem you will face is foreclosure if you don't pay back the mortgage.

 

[sabina]

But shouldn't there be something in the law to protect us in situations like this one. Bank surely gave one of those "bad" loans, and that is a carte blanche?
Thank you

 

[sabina]

Are you saying that there should be something legal that I can do? There is some protection for cases like mine?
Attorney I found got "cold" when I stated that I would like to explore it, to avoid personal bankruptcy.

 

[presutin]

Sabrina - talk to the bankruptcy attorney since your case involves two different aspects of bankruptcy - business and personal liabilities. Good luck to you!

 

[dee_dub]

How did they give you a "bad" loan? Their money was good when they gave it to you. If you're implying they shouldn't have given it to you because you were a bad credit risk and so you shouldn't have to pay it back, that's not the way it works.