When a borrower “surrenders” a property in a bankruptcy, the ownership doesn’t automatically revert to the bank.
“Surrender” means you are declaring that you do not intend to keep the property. The house and the liability of ownership remain with you, the owner, until you get rid of your ownership. Ask your bankruptcy lawyer exactly what "surrender" means.
How Do I Get Rid Of Ownership?
The house needs to be sold to a new buyer, or get foreclosed upon or conveyed by deed-in-lieu to the lender.
But I thought the bank takes the house in the bankruptcy...
It is a common misconception that the house somehow magically goes away if you surrender it in a bankruptcy. Owners who filed bankruptcy are often surprised to find out months after the bankruptcy is over that they still own the house. A lady called me three years after her Chapter 7 bankruptcy was over. She had just been told by a mortgage broker that she can't get a loan because she still owns her house and has a $300,000.00 mortgage on it.
The bank hadn't foreclosed for three years. The house was vacant except for vandals who occasionally would have their parties, destroy staircases, use the spindles as spears and poke holes in the drywall.
The liability remains with the owner
She had owned a home for three years without even knowing it. If someone would have been injured she could have been in deep trouble.
Check with your bankruptcy attorney what the status of your house is after the bankruptcy is over. You may want to look into a short sale to get the house out of your name. Your lender may even give you $3,000 as a HAFA incentive.