Do I need to consult a BK or Real Estate Attorney...

Asked over 1 year ago - Santa Clarita, CA

I had a BK discharge in June of last year. I decided to keep my home and continue making the payments. During the BK filing , I actually applied for a loan mod and was declined as soon as I assigned a discharge. So, time passes on, now I get a letter from the bank stating the chap 7 released me from the loan liability , but the lien is still valid and enforceable on my property. The bank wants me to call them to establish payment arrangements. I don't know if I have negotiating power with the bank or I am at their mercy to accept their terms , i.e. higher interest rate, short sale deed in lieu? What do I do? Who do I talk to?

Attorney answers (4)

  1. Antoinette Cara Liewen

    Contributor Level 15


    Lawyers agree

    Answered . Even though your personal liability was discharged in the bankruptcy, the lien still remains on your property. If the mortgage is not paid, the bank will foreclose. Your request for a modification may have been denied for a variety of reasons. My law firm does loan modifications, short sale negotiations and other forms of troubled debt resolution. Please call us to discuss your case. We do not charge for a consultation and we may be able to assist you.

    DISCLAIMER: This answer is provided solely for informational purposes only. This answer does not constitute legal... more
  2. Joseph Ryan

    Contributor Level 12


    Lawyers agree

    Answered . I agree with the above answer - although your personal liability is discharged, the lien is enforceable against the property. Have you fallen behind on payments since the 7? Were you current on payments when the 7 was filed?

  3. Michael Raymond Daymude

    Contributor Level 20


    Lawyers agree

    Answered . If you have been current on your loan obligation (including taxes and insurance) the letter is probably a mistake. Call them and ask about the letter. That is the first step. Although you were not eligible for a loan modification earlier, circumstances may have changed. Apply for one now. The worst that can happen is that you will again be determined ineligible and you're stuck with the present terms.

    I am licensed in California only and my answers on Avvo assume California law. Answers provided by me are for... more
  4. J. Thomas Smith Ph.D.


    Contributor Level 20


    Lawyers agree

    Answered . I agree with my colleagues. Consult with a bankruptcy attorney who handles loan modifications if you plan to keep the home.

    Law Offices of J Thomas Smith J.D., Ph.D 11500 Northwest Freeway, Suite 280 Houston, TX 77092 713-LAWYER-2 www.... more

Related Topics


Bankruptcy is a legal way for people or businesses who are no longer capable of paying back their bills to clear these debts and start over.

Chapter 7 bankruptcy

Chapter 7 bankruptcy is a form of bankruptcy where your debts are canceled, but some of your assets are sold to pay off part of your debt.

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