I am divorced. We both walked away from house. She filed bk7. I have just returned to the house and started talks with lender to work something out. I have been told that pursuing a quiet title action or working something nominal out with her are my choices. The nominal arrangement I am told, could be contrued as fraudulent activity on behalf of her BK where she relinquished claim stating the house was underwater.
Any feedback on this?

The bankruptcy court looks very carefully at any property transfers that occur during the 2 years prior to the bankruptcy filing. If a transfer is made for less than market value then the court can void the transfer because it will be assumed that she was trying to defraud her creditors. However because of the situation (the divorce, the loss of value, etc.) you may be able to do this. You should contact the bankruptcy trustee for her case and see if you can work something out with them. If the trustee approves it then the transfer won't be voided.

Thanks for the info.

My pleasure. Good luck!