Leaving house morgage after bankruptcy

[Silex]

What is the name of your state? FL

I think I understand this correctly, but just wanted to confirm.

My ch 7 bankruptcy was discharged about a year ago. My house mortgage / lien was included the bankruptcy but I never signed or agreed to a reaffirmation agreement on the loan, I just did as my attorney said, if you want to keep the house , just keep up on your monthly payments.

I am now getting ready to move, I might try to sell it and pay off the loan if I can make some profit, but if all else fails, can't I just abandon and stop paying on the loan without having to worry about foreclosed loan showing on my credit report or any other negative affects on my life?

Thanks

 

[bigun]

Yep, the debt is discharged.

 

[HomeGuru]

Yep, the debt is discharged.

**A: I disagree as the mortgage was a secured debt that was not discharged.

 

[bigun]

He says he did include the mortgage in the bk.


My house mortgage / lien was included the bankruptcy but I never signed or agreed to a reaffirmation agreement on the loan, I just did as my attorney said, if you want to keep the house , just keep up on your monthly payments.

 

[Silex]

Now I am confused, yes it was a secured debt, i.e. the lender still owns the lien after bankruptcy and have the right to put in a stay on the house but they never did and I just kept paying on the mortgage so we could continue to live here.

Can they still foreclose? If so, will there be any public record or report to credit bureaus that it was foreclosed?

Also, if I understand the bankruptcy law correctly, if they sell the house, they can NOT come after me for the remaining balance, if any?

I am trying to rebuild my credit and I believe after two years, I should be able to qualify for a FHA loan. I just want to make sure I won't screw myself from getting a house in the future if I abandon this one.

Thanks

 

[HomeGuru]

He says he did include the mortgage in the bk.


My house mortgage / lien was included the bankruptcy but I never signed or agreed to a reaffirmation agreement on the loan, I just did as my attorney said, if you want to keep the house , just keep up on your monthly payments.

**A: as you know, any petitioner can include anything in the BK. That does not mean that the debt is automatically discharged. A mortgage is a secured debt that does nto automatically get discharged in BK. Even if there was not affirmation agreement signed, the lender can continue to accept payments and keep the loan intact. If the writer does a title report and talks to the lender, the mortgage will show up on title and the lender will acknowledge.

 

[Ladynred]

Yes, it IS discharged. The discharge doesn't remove the SECURITY, it removes the liability for the DEBT.

If there is no reaffirmation of the loan, then the DEBT is discharged. The security is still there, the homeowner can't stay in the house without paying the mortgage, so the bank still gets paid and they get to stay in the house. Should he/she decide to give up the property, the bank gets it back but the debtor has ZERO liability and walks away free and clear and the bank can't go after the debtor for a penny of it.

 

[HomeGuru]

Yes, it IS discharged. The discharge doesn't remove the SECURITY, it removes the liability for the DEBT.

If there is no reaffirmation of the loan, then the DEBT is discharged. The security is still there, the homeowner can't stay in the house without paying the mortgage, so the bank still gets paid and they get to stay in the house. Should he/she decide to give up the property, the bank gets it back but the debtor has ZERO liability and walks away free and clear and the bank can't go after the debtor for a penny of it.

**A: let's get the exact details of this case from the writer.

 

[Silex]

**A: let's get the exact details of this case from the writer.

What else do you need to know? I looked though Filed paper work and I did verify I disclosed the lendor and the property as a secured dept.

I did not realize my attorney did this till now but on my "Chapter 7 individual debtor's statement of intention". For the 2nd item, part b. "Property to be Retained", the house mortgage is listed as "Debt will be reaffirmed pursuant to 11 U.S.C 524(c)"

I never signed a reaffirmation letter, can this be used against me?

 

[HomeGuru]

What else do you need to know? I looked though Filed paper work and I did verify I disclosed the lendor and the property as a secured dept.

I did realize my attorney did this till now but on my "Chapter 7 individual debtor's statement of intention". For the 2nd item, part b. "Property to be Retained", the house mortgage is listed as "Debt will be reaffirmed pursuant to 11 U.S.C 524(c)"

I never signed a reaffirmation letter, can this be used against me?

**A: look throught he listing of debts approved and discharged by the Trustee. Do you see your mortgage loan on the list? I think not since the lender would not allow such a thing. Then contact your lender and have them pull up your file and tell you the status of your loan.

 

[Ladynred]

HG, there's simply no need. The discharge papers do not list the debts that were discharged, it merely says, basically, that all debts that were dischargeable were discharged. A secured loan that is NOT reaffirmed is no different - it gets discharged along with the rest.

I think not since the lender would not allow such a thing.

Nonsense. It happens every single day. The bank isn't losing the house, or any money for that matter, as long as the debtor wants to keep the house and keeps paying. The banks are perfectly happy to keep taking the payments and let you stay in the house, but the liability for the DEBT IS discharged if there is no reaffirmation agreement signed and filed with the court.

 

[Silex]

Thanks, as I didn't remember seeing a list of what was approved and not from trustee, was getting worried

The only thing I remember (which I can't find) is a letter stateing my my trustee was satified and approved the discharge of the bankruptcy. Will have to get a another copy of this first thing next week for my records

I appreciate all the responces you all have given back, I probally check with my attorney to make sure I am doing the right thing though, before I do it

 

[rosier2000]

I'm in the same boat, but with real estate prices rising in my area, my house has a lot of equity. Why would anyone want to walk away (with any equity) without selling the propertyand paying off the mortgage? Discharged or not.

 

[HomeGuru]

Thanks, as I didn't remember seeing a list of what was approved and not from trustee, was getting worried

The only thing I remember (which I can't find) is a letter stateing my my trustee was satified and approved the discharge of the bankruptcy. Will have to get a another copy of this first thing next week for my records

I appreciate all the responces you all have given back, I probally check with my attorney to make sure I am doing the right thing though, before I do it

**A: please check with your attorney and your lender and post back.

 

[HomeGuru]

HG, there's simply no need. The discharge papers do not list the debts that were discharged, it merely says, basically, that all debts that were dischargeable were discharged. A secured loan that is NOT reaffirmed is no different - it gets discharged along with the rest.

**A: so you are saying that in a case of a BK petitioner filing a Chapter 7 who has a mortgage loan, the mortgage loan automatically is discharged?

***************

Nonsense. It happens every single day. The bank isn't losing the house, or any money for that matter, as long as the debtor wants to keep the house and keeps paying. The banks are perfectly happy to keep taking the payments and let you stay in the house, but the liability for the DEBT IS discharged if there is no reaffirmation agreement signed and filed with the court.

**A: that makes no sense. Read your post again.