If you file for bankruptcy, the creditor has a limited period of to file a lawsuit in bankruptcy court called an adversary proceeding to allege fraud. The purpose of the adversary proceeding is to seek a "carve out" of this debt from your discharge.
It isn't clear from your question if you have filed for bankruptcy already or not. I recommend consulting a local bankruptcy attorney right away before this gets too far.
First, the firm is a debt relief agency according to the U.S. Bankruptcy Code. We help people file for bankruptcy.... more
First, the firm is a debt relief agency according to the U.S. Bankruptcy Code. We help people file for bankruptcy. We also do other stuff and we do it well, but Congress wants me to post this notice.
Second, nothing on this site is legal advice. You are not my client unless you enter into a written agreement signed by you and me.
I am unclear on your circumstances, however, based upon my limited understanding that the debt relates to a 2nd mortgage and that the holder has brought a court action to collect, I can tell you that I agree with attorney Alexander's comment: If you presently live in the home that is subject to this Second mortgage and you want to remain there, Chapter 13 might be a good option. Alternatively, if you are no longer in the home , or prepared to leave and let the home go to foreclosure, Chapter 7 might be a better solution. Additionally, the iInclusion of the word "fraud" is typically a red flag in most any context, but in this case it seems like the creditor might be seeking to revive a debt that was previously forgiven, on the grounds that their willingness to forgive was based on false, or "fraudulent " information that was supplied to them, perhaps an inaccurate financial disclosure report? If this is the case, then the alleged fraud might not create a problem in bankruptcy, as long as the original loan was not given in reliance upon fraud. Moreover, the bad news is there are too many variables and unknowns to give you any solid answers to your posted question. The good news is that most attorneys, like myself, will provide you with a free consultation, during which you will have an opportunity to discuss the relevant details and undoubtedly get some valuable information in return. In your situation, you really need to get some reliable information about which debt resolution options may be available to you, as well as some trustworthy advise as to which is likely to be most effective in your particular circumstance. As my office is relatively close to Boston, I invite you to call me if you like. Whatever you do, where you have a law suit pending, it would be wise to avoid any unnecessary delay in seeking assistance.
You need to contact the attorney you hired to help you with your chapter 7/13. The plaintiff is alerting the debt was discharged based upon your fraud upon the court. Your attorney is in the best position to help you in this matter.