QUESTION
Am I still liable for my mortgage after chapter 7 bankruptcy and why?
Asked on Sep 16th, 2015 on Bankruptcy - Colorado
More details to this question:
I filed Chapter 7 bankruptcy two years ago. I reaffirmed my mortgage loan. Since then all correspondence and phone calls with the mortgage company always includes them saying to me that my loan has been discharged and I am not required to make any payments, and that any payments I make are voluntary.I did not think anything of it until recently we now wish we could let them have the house back. I talked to them about it and they assure me, over the phone, that all I have to do is tell them I am moving and that we do not want the house and then that is it.My lawyer tells me no, I signed a reaffirmation agreement so I am still liable for the mortgage. The mortgage company says that yes, we signed an agreement and so did my lawyer and then they signed it. But no judge or court did, so it was discharged. Can you help me?
6 ANSWERS
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Your lawyer isn't familiar with bankruptcy and is too stupid to know she or he is ignorant and look up the law. If the judge didn't approve your reaffirmation agreement, then reaffirmation agreement isn't effective. You can tell them you're moving and leave. I would recommend that you do a deed in lieu or a short sale, so you don't have a foreclosure on your credit record.
Answered on Sep 21st, 2015 at 4:00 AM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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First things first: check with your BR lawyer to be certain that the reaffirmation agreement was filed with the court. If it was not filed, it has no legal force. Which is what you would likely prefer. It may be that the lender thinks that the debt was not reaffirmed for whatever reason. (This is assuming that the mail they are sending you is not simply a form they foolishly send to all their borrowers who have been through a bankruptcy.) If they are willing to accept a surrender of the real estate WITHOUT ANY CLAIM FOR A DEFICIENTY, get that assurance in writing before you sign a deed back to them. Your lawyer should be able to help vet any documents.
Answered on Sep 21st, 2015 at 3:57 AM
A reaffirmation that is not approved by a bankruptcy judge on the record is not a valid reaffirmation agreement at all. Many bankruptcy judges wisely REFUSE to approve reaffirmation agreements submitted to them because the chance of liability is so large. Why are you not talking to a local realtor about selling the house instead of making things worse for yourself by looking to GIVE THE HOUSE BACK?
Answered on Sep 16th, 2015 at 2:24 PM
Bankruptcy Attorney serving Livonia, MI
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Charles J. Schneider, P.C.
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You do not need help. You just need to listen and believe your lawyer who is right.
Answered on Sep 16th, 2015 at 12:54 PM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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I would strongly suggest you go back to your bankruptcy attorney and determine what the actual status is. Otherwise, engaging new attorney and have the discharge reviewed to determine whether or not a mortgage note was included in the discharge. Given a choice between the advice of someone over the phone from the mortgage company and that of your attorney, I would tend to believe your attorney first.
Answered on Sep 16th, 2015 at 12:06 PM
Derek W. Freeman
Your reaffirmation agreement should have been filed with the bankruptcy court, within the time limit set by the court. If it wasn't timely filed, it may be null and void. You will have to check to make sure. Your attorney should be able to tell you. If it was timely filed, then it is valid, and you will be responsible for any deficiency caused by the foreclosure sale. So you want to make sure, before you walk away from the home.
Answered on Sep 16th, 2015 at 11:17 AM