If 2nd mortgage files a civil contract lawsuit instead of foreclosure and gets a judgment, can that be included in ch 7?

Attorney answers (2)

1. Licensed in FL

   

   Robert Tardif

   Fort Myers Bankruptcy Attorney

   Contributor Level 13

   Answered November 17, 2009 13:11. Second mortgage holder can seek a money judgment as opposed to foreclosing. If they get a judgment, it doesn't make sense that they would try to take the home. As a general judgment holder, a creditor generally cannot force the sale of the homestead. However, keep in mind that just because they get a money judgment does not mean they do not still have a valid second mortgage. Creditors are entitled to only one recovery. If they do not get paid via judgment, they still technically can foreclose. However, the amount of the first mortgage and the possible value of the property seem to indicate that that will not pursue that route.

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2. 

   E. Brian Davis

   Louisville Bankruptcy Attorney

   Contributor Level 14

   Answered November 18, 2009 12:52. Yes, that civil judgment can be discharged in bankruptcy.
   
   The bankruptcy will not eliminate the mortgage lien however, unless it is stripped on. Consult a qualified bankruptcy lawyer near you to find out how to do that.
   
   See the second link below for a link to attorneys who are members of the National Association of Consumer Bankruptcy Attorneys.

   • National Association of Consumer Bankruptcy Attorneys

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