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We filed bankruptcy 5 years ago. We received a discharge from the court....we are still paying our first and second mortgages

Mentor, OH |

We applied for mortgage reduction for both but was declined.
What could happen if we stopped paying second mortgage....could they foreclose or put a lein on house?

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Attorney answers 2


Oh, there are a lot of questions I would like you to answer before I would be able to answer your question. Like how much is your house worth and what is the balance on the first mortgage? And where are you looking to go with this? Do you plan on staying in the house or leaving?

Bankruptcy discharged your personal obligation to pay your mortgages. Stop paying, and you could lose the property through foreclosure. But at least the lenders can't sue you. Many times if there is little or no security for the 2nd mortgage to attach (your 1st mortgage is worth about what your property is worth), the 2nd mortgage will settle for a lump sum. But the 2nd mortgage has no incentive to settle as long as you make your payments each month.

Before you decide to gamble, you ought to educate yourself on the odds, which means looking at the value of the property, the amounts you owe the lenders, and other pertinent factors. Hope this perspective helps!


When you took out your mortgages, you gave your mortgagees two ways to enforce mayment. You signed a promissory note for the loan. The personal liability on that note is what your bankruptcy action discharged. You also gave your mortgagees a lien on the property. That lien was not voided by the bankruptcy, so if you fail to make your payments as agreed, yes, the mortgage can definitely foreclose. They won't have to "put a lein" on your house because the lender already has one. The only thing that would discourage foreclosure by the second is if the fair market value of the house is markedly lower than the balance due on the first mortgage. In general, bankruptcy does not give debtors a "free house."

Best wishes for an outcome you can accept, and please remember to designate a best answer.

This answer is offered as a public service for general information only and may not be relied upon as legal advice.

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