Declaring bankruptcy with a mortgage

What happens to the shortfall on my mortgage?

If your property is sold, and the sale amount is insufficient to payout the mortgage held by your bank, the shortfall is an unsecured debt and will be caught by your bankruptcy. You will not be required to pay the mortgage shortfall.

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Further Reading: We recommend our article ‘Types of debt covered by bankruptcy‘ and ‘What is Bankruptcy? How Does It Work?‘.

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